I'm not the wisest about spending money, especially when it comes to things like clothes, shoes and accessories. I'm guilty of buying items for the life I wish I were living, instead of for the life I'm actually living. For example, I recently bought this big, floppy, black and white sun hat and envisioned myself wearing it as I strolled along the beach every weekend in Malibu. And guess what–my feet haven't touched the sand once this year.

I'm not as bad a spender as some of my fellow Gen Y-ers are. Some have to be seen in a luxury car, even if it means a monthly payment of $500 and premium gas. Some insist on going out to trendy restaurants and bars  so as not to miss out on their local social scenes when staying home with a home cooked meal and a bottle of wine would have been much cheaper.

Gen Y's willingness to splurge comes in spite of their obvious financial troubles. In an age of inflating education costs, stiff competition for entry-level jobs, measly starting salaries and sky-high rents, Gen Y faces far more money-related challenges than their baby boomer parents did.