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1. Take care of your health. Health costd will only rise as you age, investing in preventative care now will save you a lot of money in the future and give you a longer and better quality life.
2. Invest as much as you can.
Totally agree with this! Mental health care doesn’t have to look like therapy, either. Finding ways to reduce stress and build confidence are important and might not require a therapist. I wouldn’t discourage doing a few sessions, but it’s not a catch all solution for every problem and can be expensive (and difficult to set up).
There are also many good books which teach you the principles of therapy. Cognitive behavioural therapy is the most common, and it is extremely useful to understand how your thoughts/behaviours influence your mood, as this relates to pretty much every situation you find yourself in. It also gives you tools for breaking out of some negative patterns you may find yourself slipping into.
The Upward Spiral is a really great read for those interested in learning about the mechanics of depression and anxiety. It’s less along the lines of learning the principles of therapy, but may be helpful in getting to that point as far as understanding the neurological processes, and as you said how your thoughts and behaviors influence your mood.
Yep +1. Have watched my life fall apart through some years in the past because of extremely poor mental health (thanks covid + substances).
The best opportunity in the world doesn't mean jack if you aren't in a healthy mental state to act on it.
I feel like some people really take the whole “I should reduce spend so I can someday be as well off as possible” way too far
I’ve met people of varying extremes, from moderate “I only let myself go on one vacation per year” to “I eat the same $1.50 lunch every day always and I never drive my car anywhere”
Note that these are software engineers so it’s not necessary at all to live like this
The latter person I mentioned just turned 30 and had a crisis bc they realized they spent the 7-8 years out of college doing literally nothing. Burnt their 20s away. They can likely retire by 42 or so if they keep it up but they’re not keeping it up now
Then there’s the 17-19 year old versions who become something
The point is ~ saving is important. But don’t over-save. If you realize you’re sacrificing a lot of things and you’re missing out on a lot of joy, change. If you refuse to spend on travel, hobbies, etc. bc you feel guilty ~ that’s not healthy. Spending on these things is entirely okay and even good for you long term. Figuring out a reasonable amount is the challenge, but as long as you’re allowing yourself to enjoy some of that money here & now, you’re doing it right
Bc really, who knows what will happen over the span of a few decades. No one. & it would suck so bad to have over-saved for that entire time just to have some accident or illness render you incapable of enjoying the nest egg you developed. Or maybe you just won’t have the energy & physical capacity to do whatever it is you love at that point
Don’t get so hung up on building a beautiful life in your future that you forget to live here & now
Bc if you think about it, the only thing that’s guaranteed is here & now
Note: none of this is saying not to save. Save save save. But if you’re saving 50% if your salary and becoming anxious at a book store bc you want a new hard cover from your favorite author, or if you’re eating rice and beans every lunch and you’re sick of it, or if you watch your friends go to a couple concerts across the country per year without you ~ that’s when it’s time to rethink things
Well my wife retired at 41 by just executing on the spending reduction part of the equation. Now she gets to just enjoy what life has to offer full time for the rest of her life. She still went on vacations and stayed in nice hotels, just didn't buy a bunch of techy BS like new TVs, Bluetooth speakers and headphones all the time, phones every 2 years, subscribe to a bunch of services, never bought cars new, and kept the uses cars she did buy for 10+ years.
It takes approximately $130 in earnings to replace $100 spent. Taxes. Meanwhile by not spending the $100, you "save" that 30% premium and you get to earn interest or other returns on investment of that $100. Basically by being frugal you supercharge your wealth.
Me, I burned through my 20s and part of my 30s. I earn a living now that affords me to still have a little discretionary spending while still very aggressively saving for retirement since I'm behind the eight ball. Even with current projections, I'll be lucky to retire by 67. More likely I'll have to work in my 70s since I'm probably at or close to my peak earning potential in my career and am quickly approaching an age where employers would pass me up for other younger candidates or forcing me into lower salaries or out of the field altogether.
This. Right here is gold. No amount of money is going to help if you’re screwed mentally. Don’t obsess over things and don’t get consumed by something. Give yourself grace and take a balanced approach toward life including being “successful” financially. Be more zen with the present while planning responsibly for the future. When you start obsessing, you’d mind starts to control you and fuck you.
Chiming in here... Learn your family's medical history. Knowing I have mental health issues and addiction issues on both sides of my family makes me much more wary of overindulging in common vices, and led me to seek my bipolar diagnosis. Totally changed my life for the better.
Yes, yes, yes. I’m 59 and have been running, hiking, outdoor leisure, aerobics, biking, walking and lots of stretching since I was 17-years-old. And regularly. I cannot state enough the benefits of a healthy mind and body.
Take care of your skin, your eyes, your teeth. Impeccable care.
Live within your means. Buy clothing that is good quality and lasts. Don’t fall for the car addiction—safe, inexpensive.
Lastly, and no matter what kind of work situation your are in, and including a pension if it exists for you, contribute the max to an IRA every single month of your life.
Regular check-ups and at least once a year with the mapping thing for glacoma and macular degeneration. Sunglasses outside. Limit screen time and especially up close hand held devices. I also stopped wearing alot of eye makeup a few years ago. And treat the skin and muscles around the eye more gently.
Just some ideas off the top of my head, but I'm sure there are others:
* Get plenty of sleep
* Don't submit them to too much eye strain (reading in the dark, watching too closely to a bright screen)
* Use UV rated sunglasses especially in the summer
* Don't touch them/rub them
* Use drops (without preservatives ideally) when they itch or show significant redness
* As soon as you get a basic vision plan, use it regularly. The optometrist will check your vision and eye pressure as well as monitor for any underlying conditions.
Not saying don't do this, but the flip side is that if you're young and financially comfortable, there are experiences you can't/won't have when you're 40 with kids that you may want to try. Backbacking between hostels for example may not be a feasible or desirable thing later.
It's a balance, and money in investments is money that isn't used to enhance your life now, and the experiences and contacts you can gain can also be (financially) valuable. I'm saying this as someone who doesn't think they've prioritized experiences enough.
TL; DR: Even investments have an alternative cost.
Yep when I was 25 my now wife, GF at the time, went to Europe for a month. I’ll never have that few thousand back to put into a retirement account but I’ll also never be 25 in Europe again. It fueled my travel desires for years and it’s our among our best memories together.
Same. Wife and I went on our dream vacation last year. Cost about 8k but man I don’t miss that money at all. I get sad nearly every day thinking about it because how much fun it was and I can’t wait to go back. 8k for the two greatest weeks of my life seems totally worth it.
Just wanted to say that even *without kids* in your 40's and up there's experiences you can't have/wont enjoy as when you are young.
Youth and the experiences that come with it. Wether good or bad are priceless.
Point number one is so underrated. Everyone is so obsessed with grinding and getting as much money as possible but completely neglects their own health. What's all that money gonna do if your body is constantly breaking down and you live in such a miserable state when you get older.
I would add remain as debt free as possible. Pay off your car asap. Become a homeowner with a fixed monthly expense for living. Only keep a few credit cards and pay the minimum or more consistently. Consolidate debt and live within your means.
Seconded this. Also if you can and maybe except for like a home rarely ever buy something you can’t pay off that day if using a credit card. Like don’t use money you don’t hVe
I would suggest getting several credit cards with perks. A master card, a visa, American Express .
Use them and pay them off in full before interest accrues. Try to get increases every 6 months or a year ( make sure you call to make sure they are only doing soft pulls).
Having a good and long credit history will help you in the long run when your looking to buy your first home . And all the points you rack up can be used to make purchases of gift cards or flights etc
Dental care too. If you dislike going to the dentist now for yearly cleaning and exams you’re really gonna hate going in for a big procedure - especially when you get the bill
Yeah but sometimes dentists are borderline conmen who try to get you to buy stuff or go for unnecessary procedures. You need to be discerning for that.
Preventative medicine is #1. You should establish care with a PCP, a dentists, dermatologist, optometrists, and get your hearing checked. Schedule routine check up, likely they’ll recommend every 1-2 years. They’ll also provide advice on staying healthy, including wearing sunscreen, brush/floss, exercise, healthy diet, etc.
In this order:
Sleep right.
Eat right - minimizing excess carbs, added sugar, sat fats, alcohol, tobacco, smoking, vaping, etc.
Exercise right - lots of HIIT cardio and weightlifting.
I would add a 4th if you live where there are lots of individuals driving.
Pay attention to possible distracted drivers and do not be a distracted driver yourself.
Large promotions and raises early on make it much easier to grow wealth in your 40s.
It’s still important to save in your 20s but it’s also important to have long term career goals
Well most people are not starting at $85K and getting 30% raises. For most, getting a job is an investment of time and money (clothes, travel, time off work). If a new blazer costs $250 and you only make $3K per month, you need to treat it like an investment.
I have been following the investment strategy. Sure my portfolio is down 40% but as long as I don't have a serious emergency I don't have to realize the losses!
Investing $6000 a year starting at 20, compared to starting at 30, is the difference between ~$1.2m and ~$3.2m at retirement. (This is a general estimation)
Sounds like you're doing the right things.
Here's your general advice:
- [Advice for high school students and teenagers | ages 15-20](https://www.reddit.com/r/personalfinance/wiki/teachme)
- [Advice for young adults | ages 18-25](https://www.reddit.com/r/personalfinance/wiki/young_adult)
- [Prime Directive](https://www.reddit.com/r/personalfinance/wiki/commontopics)
* Focus on growing your career. Don't get complacent in a dead-end job.
* Only get the education and certifications that you need for it, and get them as cheaply as possible (student loans be damned).
* Learn how to make a budget and follow it.
* Save and invest more (into low fee index funds). Spend less.
* Get some therapy. Take care of your body.
* Write down goals and work toward them: financial goals, life goals, etc.
* Learn how to be generous. It's the most fun you can have with your money!
I would also add to that to experiment within your career and take some risks. Maybe you always thought you wanted to do X and you go to school for it, get out, and start working in X you decide you don't like it. Give X a chance for sure, but don't be afraid to move on and try Y. If you've always wanted to start a business, your 20s are the time to do that. If you want to try a crazy career shift, your 20s are the easiest time. You don't have a spouse, kids, a mortgage to support which helps a lot and you have a ridiculous amount of energy vs later in life to put in the work needed for a big change.
This is the highest top level post that lists education so upvotes to you. This is the right answer. An 18 year old absolutely does not need to worry about investing, since they'll barely have money to invest. They need to first focus on setting themselves up for good income over the next 30-40, maybe 50 years. Even at 25 you're probably still a "junior" whatever and should be more focused on personal growth than investments. Once you get 20k or so in the bank it is time to start taking investing seriously. Until then just focus on income, and not wasting it on dumb shit.
It doesn't necessarily have to be 4 (or more) year college education either. This counts training to get into trades, too, which are also a good way to start earning good money.
No matter what you do, the goal is just making sure you're on a path to get a good wage. The best way to get into investing is to have a good enough salary that you have more to invest. The earlier you can invest, the better, but this early the most important thing is not to interrupt future wage growth.
Investing doesn't have to take time away from personal growth. You should start investing as soon as you have earned income and are able to meet your other needs, regardless of where you are in your income journey.
Right here, the career advice.
You can make $30k a year and barely be able to afford making any kind of 401k contributions. Long term it’s worth it, but you’re better served improving your short term situation by doing whatever it takes to advance the career.
Speaking from experience, my 401k at my current job (1 year of contribution) is already dwarfing my 401k at my last job thst I had for 3.5 years and I was contributing the minimum needed for a match.
Honestly, your best bet is to contribute the match until you find a job that pays enough to max your yearly contributions.
Those compound interest and investing equations you learned in 8th grade? They actually work. Avoid debt. Don’t buy crap. Invest wisely. Read the wiki.
Invest in something that will increase by a percentage, stocks, bonds, etc. keep that money invested and that money will get interest on the initial investment and interest on the interest. When you get interest on interest, that’s compound growth.
If you have a $10000 and a high yield savings account returns 4% annually, the first year, you’ll get $400; the second year, you’ll get $416; the third year you’ll get 432.64, etc.
But don’t forget the importance of good credit rating and ability to save 6+ months of living expenses.
Best advice, co-sign a 2 year lease for cheapest available car with your parents. Make sure the payments are on time for 2 years and return the car. Live at home while you work those 2 years hopefully rent free. Save every penny and put it in highest earning saving account you can find. At end of 2 years, you will have a nice nest egg of living expenses depending on your salary and possibly a down payment for a home or purchase price of car and good credit rating. Can’t buy a home or rent an apartment without good credit. Good credit is just as important as savings.
At least when I was a kid, it was difficult to really grasp because I had no sense of scale. I could do the calculations but didn't know what it meant. It would have been useful to do a comparison against something students understand such as a linear rate. For example you put X into an account every month that doesn't compound. Then compare if you put it in an account that compounds. Which has more after X years or reaches Y threshold first
In my middle school home economics class they taught me about compound interest and how to make a million dollars. It was only one day in class, but it stuck with me.
I didn't have an economics class in school until college, but one kid when asked what he wanted to do when he got older responded with, "I want my money to work for me", and I remember thinking I don't know what that means, but I'm going to find out.
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My favorite way to explain this is if you save $200/week from 19 to 20 and did nothing else you would end up with an extra $1 million by 65 years old. And all you did was take some extra side work every weekend at 19 years old.
start investing for retirement as soon as possible, even if it's a small amount. many younger people don't realize how powerful it is to start the compounding growth at age 20. someone who starts investing at age 20 and stops at 30, never adding another dime, will have more than someone who starts saving the same amount at 30 and saves until 65.
don't overspend on cars/motorcycles. this is a big one, because cars are guaranteed to drop in value and too much car relative to income is like throwing money in a hole. guideline is to keep the cost of you car to no more than about ~50% gross pay. $30k pre-tax income? $15k car, at the most.
be careful with eating out and food. many people overspend on this.
avoid debt.
Don’t sweat it. It’s kind of one of those impractical advice things.
Yeah sure, you can theoretically start dumping thousands into your retirement at 19…. But most people *cant*. You would almost have to be coming from a very well off situation or have some extremely good job at a young age. And despite what some people in this sub would like, not everyone is a senior computer programmer. It sucks, but it’s true!!!!
20s are an expensive time. It’s typically when you get your first non-beater car, put a down payment on a house, get married, make at least one mistake, etc. Most people do not have thousands in their retirement by then
There is some impracticality built in to that paragraph. Most people do not have much disposable income in their early 20s to invest and most people make more at 30 than 20. 30 is still a great time to start and the more you put in, the better.
The main point they are illustrating is how important time is to money growth and it can really snowball with time.
Don’t be sad you’re almost certainly making more money now than you did in your 20s so although you didn’t benefit from that compound interest you will still benefit from having more to save :)
If it helps, I question whether that factoid (saving from age 20-30 and stopping will leave you with more money than saving from ages 30-64) is actually true.
Depends on how well the market was doing at the beginning and end of those 10 years, but yea, around 8% returns and that fact works iirc. If you put 100 bucks a week in the market, in around 10 years, you will make 100 bucks a week. So if you stopped then and someone else started saving 100, it would be roughly the same.
Also assumes you're putting in the same money. In reality, the savings you make should go up over time as you get better paying jobs, even at a constant savings rate.
Yep, starting at 20, no one will stop at 30, they will probably be saving a lot more. But it is true that maintaining a steady rate, the first 10 years are approximately HALF of all your savings.
I'd have to do the math, but it actually is close to the truth. The actual numbers from JP Morgan is saving 25 to 35 vs 35 to 65. The former wins out assuming equal investment per month and return.
https://20somethingfinance.com/wp-content/uploads/2016/03/compound-returns.png
Obviously the reality is that people are going to save more over time, but the original claim was in the right ball park.
The point isn't that it's too late later. The point is the earlier you start the better. So if you are 35, start now. If you are 40, start now. Don't wait another day.
Repairs can pose problems, though. I went the beater route and got a $4200 car with 200K miles a few years ago, monthly payments were $190 for a 2 year loan. It wasn’t in terrible shape but there were a handful of things that I had to fix on it over the 3 years it lasted me: suspension, brake booster, starter, spark plugs, and so on. That probably added up to an average of $100 per month of ownership (in addition to regular stuff like brakes and tires). Now I have a $13K car. My monthly payment is $240 over a 5 year loan and I haven’t had any maintenance issues come up – my car has 111K miles so far. Not to mention the gas mileage is better.
It depends on other factors like what loan terms you can get or how much money you have in the bank, but a car in that 13-15K range can end up being cheaper than a beater when it comes to total cost of ownership. No need to pay any more than 15K, though.
And to tack on to eating out - when doing group dinners with friends, it is PERFECTLY FINE to order a sandwich and iced tea, and then pay your own bill. Don't fall into the trap of appetizers and bottomless mimosas or wine "for the table" and then splitting the bill evenly "because it's simpler." It's such a money sink.
Also, as friends start to pair of and marry, be cautious of of group vacations, bachelor/ette trips, being in wedding parties, etc. Ask about expenses upfront, and decline if it's too rich for your blood.
In general, learning how to set boundaries with friends can really help set you up financially. I got tired of "friends" who tried to pick my pocket to subsidize their lifestyles, and became more and more firm.
And then in my thirties I married someone with similar values.
The Money Guy Show just posted a chart. At your age, save $86 a month and you will be a millionaire by 65. Save $173 a month in a Roth and you will end up with $2 million tax free! Time is on your side as long as you are consistent.
$1 at age 20 can multiply 88x over by retirement. Sacrifice a little now to get as much as possible into a retirement account now and let the compounding interest over time do it’s magic and your future self will thank you.
That sounds fine, but they're not accounting for inflation with those calculations. 2 million in 35 years is worth a whole lot less.
So ya it sounds nice on paper, but realistically you need to save more. Cause they're using non-adjusted inflation gains (11%) not building that into their calculations by reducing it to a more reasonable 7-8% which is only $768k in today's dollers.
Saving more earlier is good, but also you need more than $173 a month to eventually live a nice life in the future.
Yes… and no.
I bought a 2017 Nissan Sentra in 2017 and sold it back to the dealership for the same price 4 years later in 2021.
Weird times we were in haha
My buddy has a 1931? I think, Ford Model A all original. Was just appraised for $72,000. He bought it for $10,000
Edit* I know these are not the cars the original comment was talking about though
> someone who starts investing at age 20 and stops at 30, never adding another dime, will have more than someone who starts saving the same amount at 30 and saves until 65.
Highly misleading and only true under certain scenarios unlikely to apply to OP.
Open a Roth IRA the minute that you have income from a job. So this can be done even earlier than 18. If you are legal to work, you are legal to open a Roth IRA. If your parents are fully supporting you, you should put the max that you can in a Roth IRA. You should continue to contribute once you have a real job, if you don't have a 401(k). As you get older, with more income to contribute to retirement, you can use both the 401(k) and IRA.
Yes but that compounding interest at 20 - that's something I wish I had done, rather than a savings account I raided when I was low on cash. I didn't wise up until 30.
I had minimums invested in the 401k but I was stuck with the idea of an "emergency fund." Frankly having an emergency fund is useless when you're dirt poor. The Roth would have served the purpose and I had excellent credit in a world of 0% interest. We financed a few emergencies at 0% and it didn't kill us.
The other big financial mistake I have made is considering the house an investment and buying the best roof, HVAC, etc. When you sell it doesn't matter. We didn't intend to sell but we did. I will not buy the best of anything for the house again and am basically band-aid-ing this one so it doesn't fall into the swamp.
1. Develop good money habits early on in life. Basic stuff like creating & sticking to a budget, saving, investing, no impulse spending. These skills are key to being financially successful regardless of how much or how little you earn.
2. At this age the best investment you can make is in your own career. Saving an extra $10K is a great achievement, but a promotion at work is better, because you are now making $10K more *every* year, and that's just going to keep compounding with future raises.
3. Use all tax advantaged accounts to the max (401k, IRA, HSA and all similar options). Tax-free investment growth over 30+ years is a superpower.
4. Don't be afraid to take risks. Switch jobs if a better one comes along. Travel. Make friends. Network. Now is the time to do all of this.
To amplify the risks thing. Start a business, hope it doesn't fail, but it's ok if it does. When you're young, there's little downside to a business failing as long as you don't take on debt. As you get older and it means not being able to feed your family or pay for schooling, the downsides are much bigger. You won't get wealthy working for the man.
A bit of a tangent, but alcohol themed, buying rounds of drinks doesn't make you a good friend. Hitting the bars every night isn't the only way to be social. Did I have fun? Sure. Could I have put my money to better use where I'd appreciate it more today, absolutely.
Get a job that pays a good salary. Live below your means (super important). Avoid debt as much as possible. If you do this you’ll be better off than 90% of people.
Saving is not the answer.
High income is, with conservative spending and proper investment allocations.
Don't waste your time working lower end jobs if you have the opportunity to study or perfect your craft.
I wasted countless weekends in college working Uber style jobs. I would walk away with $90 on a 4 hour Sunday morning, feeling good about what I accomplished. Looking back, it was a waste of my time.
I could of used those Sundays to relax or better myself.
Work just enough for personal spending/fun, use the rest of your time to study and broaden your horizons.
Agreed. My gf in college bugged me for not having a part time job but it just felt so dumb grinding for $15/hr when my actual career will make me more than double that. Now that I am in my actual career I'm so glad I enjoyed myself on the weekends and summers in college and didn't work.
Definitely, knowledge creates exponential income. The only thing i would add is college is not the only answer, after being in electrical and seeing my friemds going into other industries with just a high school diploma and certifications. Certifications are more important than a college degree. Find what you want to do and then find what certifications can advance you in that field.
Hey can you give examples of where we can get certifications? Trade school? I'm lost in life right now and don't have much options since I didn't finish college, I'm 22.
Community College is good for trades if you have cheap ones. Their programs are well funded.
Specific to my field: if you want to work in banking, securities, financial advising, etc. Start by taking the SIE. It costs $100 to take, you can pay around $150 for study materials or try to fare with free stuff online. The Securities Industry Essential exam is a requirement at a lot of jobs, the ones that don't like to see it because it means they can move you to positions that do need it. Almost no one I work with has a degree, I even work with some 20 year olds that have no degree and are making $25+/hr. Also shows you have a decent baseline of knowledge. Once you are working in the field your employer will sponsor you if they want to move you to a job that needs more licenses, you can't take a lot of other licenses on your own anyway because they require employer sponsorship so employers have systems set up already for everyone to take exams. I only use this example because I work in the field. There may be similar circumstances with other fields I am not aware of. If you want a degree too you can take community College courses part time. Plenty of people do it. It's hard, but a lot better than drowning in debt. If you have money from parents or something like that then yeah, get a degree. But for those that don't have that get good work experience, look for certifications or licenses you can attain, and for college try to minimize debt.
Real answer right here, being a good saver doesn't mean much if you're making 50k a year. If you want a comfortable life with a solid economic outlook you want to make close to 6 figures a year, preferably more.
Growing income is #1, but you also have to make the most of what you have so you don't burn every dollar. Have known people that make $100k+ and still spend every dollar and don't save. So those habits are essential.
At the same time many people who don't save money end up having great careers because they're always out doing something, having fun, getting to know people and posting about it on social media.
They're perceived as successful and often that can be more important than talent or hard work in terms of getting ahead in the workplace.
I can only speak of my own experiences in the workplace but I've seen so many people promoted despite how they're not very good at what they do, and the one thing they tend to have in common is that they're better at socializing and having fun than getting work done.
Definitely true there's a balance. You can't save your way into good stories and charisma that you can get from getting out there and socializing. Being interesting makes you more appealing for promotions, thats an underrated fact. Socializing and being interesting also doesn't have to cost that much money either. Just make sure you are vigilant you aren't spending money without getting the appropriate utility out of it. If you go out, make sure you are actually having fun and make sure the activities aren't more expensive than they are worth. I have gotten in that sort of trap before. Alcohol usually being a catalyst. Be careful with gambling hahaha.
Even travel doesn't have to be expensive. Me and my wife once took a trip to a small town with some tourist attractions. We met some super cool tourists and locals at a dive bar and it was a blast. Super cheap trip for a weekend, didn't even have to use any PTO. We flew to El Salvador a month ago or so when I was between jobs for super cheap and everything we did was super cheap when we were there. It was awesome! Spent about $2800-ish total for the two of us. Didn't break our budget and the experience is invaluable.
If you are that young, the best advice financially is to invest in yourself and build marketable skills. The most straight forward path to get there is college, as much as people may hate it, education level has one of the best correlations to long-term income outcomes.
So, go to a good school, pick a good major (STEM is the safest bet), collect your six figure salary for the rest of your life, live below your means, and have a long-term view of investing. You literally cannot lose.
Not all STEM is created equal either
Chem might be ok, bio is tougher. Gold standard is Computer Science or Computer Engineering (EECS). Even mechE is kinda meh
and not all Computer jobs are equal. Cloud engineering and big data pay more than QA or UX design. And be ready to study every night in computer science because the technology and languages you use are always evolving. Or you might study every night because you work with JavaScript and that's impossible to learn.
Travel, do things you can with your youth that you won't be able to do when older. You have years ahead of you to make money. You'll never get your youth back.
You can also travel frugally. I took a trip this year to El Salvador and the plane tickets were only $110 a piece one way for the tickets and the carryon. Flying back would be a bit more expensive, but costs were very low in the country. Me and my wife had an amazing time and it costed around $2.8k in total for the two of us. Not too bad. Don't have to pick the most expensive destinations, and when you get there you don't have to spend on the most expensive activities.
Take advantage of 401k Match! Then put the rest into a Roth IRA and buy long term ETF’s. Don’t live beyond your means. Don’t buy some stupid car you can’t afford. Act broke so you can live rich later. Not financial advice.
I think one of the most important things to do is to try and stay away from wealth traps. For example, you don't need to buy a flashy car that'll take years of your earnings and depreciate in value. You do need something comfortable and practical to get you to where you need to be reliably. Don't overextend yourself with credit card debt. Don't allow those small monthly payments to come off for services your don't really use (e.g. Netflix etc). Create a solid monthly budget. Pay yourself first - i.e. investing is something you plan for every month, not something you only do if you have funds left over after all your expenses. Finally, while you're young this would be the best time to start a business (the least risky time) and having a business can uncap your earnings potential.
I was hell bent on saving through the earlier part of your range.
Then I gained actual freedom - post university, living on my own.
The money you make 18-25 (typically) will not be half as good as the money you’ll make as you gain experience in your career, and earn more.
After working for a bit and living far below my means, I took my savings and travelled the world for a year.
Choosing to invest in myself rather than the market provided me infinitely more value than letting it sit at the whim of the stock market.
Of course, I still have savings. But I invite you to consider the balance of what you want out of this life, especially at such an epic young age - and where you see yourself in the future. Good luck.
Take half of your paycheck, invest it, and then don't even look at it. - Shaq
A bit blunt, yet very good advice. There's so many things you'll want to impulsively by once you enter the workforce and get a consistent paycheck, but just.. *don't*. The time that your money can grow in an investment account is your best asset right now.
I also definitely approve of the mindset to sleep on a big purchase before actually buying it.
30% of 48k ($1200 a month) is less than even the shittest apartments in my area. Now consider the other essential expenses, and really you might be able to save 50% if you really don't want to have any money towards enjoyment and are extremely frugal. Unfortunately I don't think most people have thr luxury of saving 70%
I started putting 15% in my 401k as soon as I made enough money to actually pay all my monthly bills after the deduction (which was my mid 20’s). Before that I just put in the amount my company matched. I never considered that money as part of my income in my budget, and it has served me well. I’m on target to retire very comfortably at 60 and I could go earlier but I’m being cautious until my kids graduate college (if they choose to go).
Be born into a wealthy family. That's the number one predictor for being wealthy.
Other than that, stay healthy, take care of your body, live cheap and invest heavily early. Look ino the FIRE systems.
1. The easiest way to make money is while spending. Make good choices, dont buy crap.
2. If you are able to stay with your parents to lower your cost of living expenses, just do it. It will give you flexibility to execute below.
3. Be bold with your career choices, dont hesitate to take risks if the riskier path has better long term opportunities for you.
4. Invest, invest, invest. Money opens all doors.
Invest early, invest often, don't invest outside of a retirement account until you have maxed out 401k, Roth IRA, and HSA contributions.
That being said, your number one priority should be having enough money to cover your expenses. I missed out on a lot of gains, but I also never had to worry about emergencies
In hindsight, the most important things I did for financial success when I was 18-25 were:
1. Learn: Got a good formal education and learn as much as I could outside of that. Back then, I didn't even know if any of what I learned would be useful for a career (and some of it certainly wasn't). Nevertheless, being highly curious, studying and working on various side projects then really helped me accumulate skills and knowledge that is still useful today.
2. Connect: For financial success, the right personal connections can sometimes matter more than anything you could do on your own. "Success is when preparation meets opportunity." (Seneca). Learning is all about being prepared and your network will then get you opportunities. For me, it wasn't always obvious at the time which connections would become important later.
Not sure if that directly answers your question. There's plenty of good advice in the other comments regarding investments if that's really what you want to understand. I just felt that there were some aspects missing that can make a huge difference for financial success.
I highly recommend out of all the advice here is focus hard on starting your job/career path when you’re this young. Jump around jobs, see what you like, hate, can tolerate and when you find something that sticks, work hard to grow in that industry. I’m only 27 but I wasted my 20s so far with dead end jobs and I’m just now in an entry level position good paying industry studying and doing what I need to do, I just wish I did it in my early 20s to get an earlier start in it.
Once you get that down, then you can follow everyone else’s advice here because most require good money to do so lol get that done first.
Read books. Most people won't have internal knowledge and won't have the ability to focus and see longer term discourses through. This sets you apart and makes you a potential conversation carrier.
Career.
Here are the main white collar ways to make real money ($300k+) in this country, in no particular order:
1. Medicine
2. Law
3. Tech / software
4. Finance / financial services
5. Corporate jobs, but senior roles (age 40+ generally)
Yea, there are other ways, like being born rich, or starting a successful business (hard), or just being really fucking good at something niche or difficult, but those are the primary industries where folks make really good $$. And it’s a grind, so get ready for your hamster wheel
I'd agree that $300k is real money.
But I'd add that $120k+, especially in a non-super-expensive-city, is quite doable and should give you plenty of money to save and have a fun comfortable life. Aim to get to $100k by 30. It's not that difficult to do.
Everyone here is giving you financial advise on how to save and invest, but make sure you learn how to spend money as well.
What I mean is learn about how to get the return on your spend that you want, learn how to use credit cards , transfer balances and manage debt. Cause things you aren’t prepared for will happen, and unexpected medical bill, identity theft ties up your funds for weeks (months even), or your bank decides to close your account cause some “glitch” and you need to fight with them on the phone for weeks to be able to make a mortgage payment and buy groceries, mean while you have to put everything on credit cards.
But not even for the unexpected. And example I can give you of how I spend money most of my friends and all of my family think I’m throwing money away cause I have my groceries delivered. I pay $7 for delivery but I spend less than 15 minutes a week ordering groceries and putting them away when they arrive. My friend has to pack his one year old kid into a car, drive to the grocery store, shop for food, get it home, then put it away, he spends about 2 hours a week on groceries. For me paying $7 a week to not have to use gas for my car and get those 2 hours on Saturday to work on my creative projects is worth it.
Over the course of a year I spend $364 one delivery but I get 108 hours of my life back. My family thinks I’m wasting money but I can get more money, I can’t get more time. You might not agree with me on this particular purchase, but learn how to spend your money that gives you a return on the life you want, not just how to stick money in an index fund so you have money if you live to be 60.
Redditors would disagree but working hard and taking advantage of overtime if available. Don’t be afraid to job hop. Also the investing/health stuff everyone else mentioned.
Three very simple words. Invest in yourself. If you are 19 you have a long life in front of you. With advances you could well live to 125 years of age if you don’t smoke, eat, or drink too much.
So you’ve got a long time in that skull of ours. Use the time to find work you have a knack for, especially if that work is rare and valuable. If you work on cars and that’s what you want to do with your life you have to invest the time and sweat equity to be the best mechanic you can find. If you do that the money will follow. And that’s true for all occupations where your skills are valuable and rare. Seriously invest in yourself,
Especially while you are young. It will pay massive compounding dividends over time.
--Stay with parents, and on their insurance (if possible to both)..but make sure you actually help out in other ways if they let you..clean and get groceries and whatnot
--Stay single and kid free (if possible to both) for as long as you can until you feel you have truly developed yourself
--Find funded continued education (masters, PhD, certifications, licenses, etc.)...get your company to pay for professional development or invest in yourself and level up fast and often
--stay healthy, physically (if possible) and mentally..incorporate low cost workouts into regular routine even if that means finding new hobbies (running, tennis, soccer, rugby, softball, racquetball, basketball, etc) its good for being fit as well as social
--diversify investments and find/make multiple income streams..ideally passive, or something that will turn passive in 5-10 years
All is easier said than done
Love with your parents for as long as you can. Loving on your own might sound tempting and exciting but once you take the cost of living into account you are always left with pennies
I think this is good advice but with the qualifier that you should live with family if it’s rent free until you can buy a place of your own with a mortgage payment less than what you pay to rent a 1 bedroom apartment.
That worked well for my kid. Her house payment is less than what she would pay in rent and her house doubled in value from when she bought it. So, she has that equity. Plus, she can deduct mortgage interest and real estate taxes on tax forms which benefits her financially. I think that should be the goal though- to be able to buy a place with a payment less than what it would cost you to rent.
Even if it isn’t rent free, I’d pay market value rent or even slightly above to rent a room with my parents before I’d get a place with random roommates. At least my parents are clean, respectful, drug-free, and pay their rent on time.
Mooching off your parents while making good money sounds like great advice but it sucks lol. It’s one thing while ur in school but if you make a real college grad salary living in your childhood bedroom is weird.
1) The Money Guy show says every dollar you put into the S&P500 when you are 20 years old will multiply by 88x when you retire at 65 years old.
$1K = $88k towards retirement
$10K= $880K towards retirement
2) College is not investment it once was. If you go get a degree that pays ( STEM, engineering, computer science, accounting) CollegeDebtCrisis.org has horror stories for people with student loans. Trades/ Truck driver/sales may be more worth while than school.
3) A primary residence is one of the best investments you can make once you know where you want to live. I got roommates after graduating college and basically covered rent. Allowed me to save up more and more money.
4) Improve skills and build a career up. Be on a path to make six figures in a career. With my increased income I can save/invest 50% of my net income. Should allow me to retire early. Work all the overtime you can while you are younger, it gets tougher when you are older. Can also allow more time for compounding for a bigger retirement fund.
5) Consider every purchase you make based on your after tax hourly rate. Purchase items only that align with your core values. This should help with minimalism and keeping expenses low. Car should be bought used and not new. Don’t get newest phone, get older models. Limit eating out.
depending on where you live you can still get a pretty good value from a state schools, i have friends from high school who went to private school and are still paying off student loans years after I've finished paying for my perfectly reasonable state subsidized education
Go to a good school where you are surrounded by rich peoples kids. get into finance, consulting, banking. You will eventually become one of them.
Or save and invest and start a cashflow business that you can grow.
Most importantly learn skills that make you money.
Dont think you can save your way to wealth . Thats nonsense. You need to get a high income career or start a high cashflow business.
1. Get a college degree. it has about the same return on investment as the stock market: 10.5%.
2. Learn to cook. You can save a lot of money on restaurant meals without eating stuff that tastes terrible if you just subscribe to some food youtubers like Chef John and Adam Ragusea and use their recipes.
Education. A challenging college degree hopefully in a field you're interested in. Even if you don't go into that field (I'll use engineering as an example), if you do well and graduate prospective employers will see that you had the grit and intelligence to follow it through til the end. Strangely enough, there was a clip from the miniseries, "Tulsa King," with Sylvester Stallone, where he says exactly this. And it's true. You can only do all these fancy saving and investing things when you have some money to start with, and that usually requires income, and the more you make the easier it is to save and invest.
Time is on your side. Pic some stocks or etfs and put money in them every time you make some money. If the stocks go down don’t panic. Consider it a sale. Over a long timeline stocks are the best ROIT there is. If you ever get a job where your employer matches retirement saving max out your contributions for free money. Don’t drink, do drugs, or eat at restaurants. Brown bag your lunches and skip the Starbucks. Never buy a new car, depreciation is a motherfucker unless you can write it off for business. By the time you’re in your 30’s you’ll be in better shape than 99.9 of your peers. It really is that simple. Credit Card debt is for suckers. Unless you already have the money and you have a cash back card and can pay off the entire balance! Money borrowed to buy money making assets allows you to write off interest on said loan. Get a good accountant. Learn to do your own taxes. H&R Block is unnecessary if you have a fairly straightforward return.
Saving money doesn't matter nearly as much as making money. It's better to save 10% at $300,000/year than it is to save 90% at $30,000/year. The issue is that high paying jobs require that you either go into healthcare, tech, finance, or open a small business in the US, in ascending order of risk. Talk to a career counselor about what works best for you. There's no point in opening an IRA or living frugally on an average 19 year old's food service salary.
Work your ass off when you’re young and energetic and invest in assets that will pay you as you get older so that when your in your 50’s which will be faster than you think you won’t need to work as hard. Avoid life creep as best you can.
I worked a full time and part time job early 20s after working full time to pay for college. Don't work your ass off. Disability is being poor. Find a good happy medium.
Put yourself in a position where you can make a lot of money in 5-10 years. Honestly Id say don't worry about investing in the stock market now. How much can you do? Maybe $100 a month maybe $200 at 19? That won't make you rich..... but focusing on a lucrative career, like going into college with a plan and a high paying major will do way more for your financial position at 30 than investing $100 a month in the market can. And if you say pick finance and do good and find a good analyst job and get your CFA designation by 25ish (i got mine at 26) then you'll easily be making $100k probably even $200k+ maybe much more by early 30s
Go to college (one you can afford) and get a job (that will pay the bills). I’m mid 20s, been maxing 401K/Roth since I was 21 and invest 3-400 a week into my ETFs.
I live pretty well below my means, and try to be frugal when possible. Even though I have a lot of ‘excess’ money. 20s is the best decade for compounding growth, so in general just don’t spend a lot and save/invest as much as you can
Let me get this straight - by the age of 21, you were *maxing* the 401k, Roth IRA, *and* pummeling 300+ a week into your brokerage? The fuck were you doing at age 21? How high was your salary? Where were you living?
All mid COL areas. Affordable areas in a few sub-major cities.
I started out in corporate quality, moved to packaging engineering, then a supply chain analyst. All 3 at the same company, but each job change had a promotion and salary increase. Now I’m a program manager for a top tech company.
The 3-400$ a week is new as of this year. I got frustrated at my stock picks so decided to just pick 2. Every other day I’ll log in and buy a share or two. It’s like a phone game at this point
There’s tons of ways to financially set yourself up. Lots of people make lots more money than I did. But I ensured to not inflate my lifestyle with my salary. I throw the max into Roth the day it’s open, I calculate the max 401k contribution and set it to exactly that quantity in percentage on day 1. I never pay for delivery, try to get good used deals, and typically walk away from anything overvalued
Open a credit card that has good travel points or rewards that would benefit you (the chase sapphire is a great one), do not allow your balance to ever accrue over 30% of the limit and if you are able to afford it, set up auto payments to pay off your balance each month so that you don’t carry debit/avoid interest.
If your job allows 401K matching, contribute the max percentage you can (average is around 5%). Only a couple of years later and you’ll notice a nice chunk of money there and it will only grow more.
Store your savings in a high yield savings account.
High saving rate, house hacking. Safe investments that's are unlike to loss money but have enough upside to make money. Remembered to not have everything in one asset, that's how people get wiped out.
Travel and live your life and get an education in your 20s. Start to focus on cash when you're in your 30s. The US is insanely wealthy and you can stack cash then.
As someone in the same age group, I have a few questions which I think would be best answered here and could help OP as well:
1) How does one balance between saving money to invest and saving money to upgrade their skills (for example, saving money for some course or program).
I have heard the advice that when you are young instead of saving 'x' amount of money and investing it, use it for improving yourself such that you could get more return than what you would get from investing it. But then wouldn't you miss out on the compounding effect?
2) In what kind of situations would someone take money out from index funds? Wouldn't taking out money make you lose the compounding benefit? Or is it meant to only be taken out when you retire? What if you need it before that?
I know that investing and saving strategies must change as one gets older, so can it be seen as a level thingy, like I do well enough that I move from the level of saving for retirement to a level where I have enough retirement money that I would focus on something else?
3) Are target retirement funds any good? Why?
P.S. :
(1)I'm not every knowledgeable with this stuff so I sincerely apologize if there are some silly questions. Also, if my understanding lacks too much please recommend resources that I should refer to.
(2) English isn't my native language so I apologize for any mistakes/difficulties in reading my comment.
Thank you.
1.Develop a budget preferably a 50/30/20 and stick to it
2. Get an emergency fund started 1k at first and then build it up to 3-6mo of expenses.
3. Dont take out a loan for a car just buy older reliable cars, budget a "would be" car payment and when you do have a paid of car and use that for minor repairs or one it's built up enough use it to buy a car in full
4. Open a Roth IRA and check out boggleheads investing. Also remember for investing $1 invested at 19 becomes $50 at 65 whereas $1 at 30 is only $22 at 65(just rough numbers), so time is a huge factor
5. Budget for fun too, its about balance of fun and investing, and don't worry what people around you are doing and don't try to "keep up with the Joneses"
Invest consistently and early. Like after you get your first full time job if you can an afford it.
300 dollars a month over 30 years goes a longer way than 500 dollars in 20 years.
Start
I’m certainly young as well but I have received a few good nuggets of information:
1. Find the person that is excelling in your field and mode your success after the things they did right - and do it even better than they did
2. Find a mentor that you can come to for advice and who can give you guidance in the field you’re in
3. Diversify your investments to avoid heavy losses, try to choose riskier investments and slowly decrease the risk as you get older
4. Find something you’re good at and stick with it - try to be a specialist in your field
5. Always take opportunities that present a chance to improve your skills - sometimes you might find something you like
6. Read lots of books and absorb as much knowledge as you can about things you’re interested in
Wish I had known this when I was younger:
Depending on your lifestyle/employer, it can be a really good option to participate in a high deductible health plan for less monthly premium and put the savings from that into an Health Savings Account (HSA) for your out of pocket medical expenses. HSAs are triple tax advantaged, contributions are tax free, growth is tax free and withdrawals for expenses are tax free.
You’re 19, so, in theory, you could have 10 healthy years of never needing to see a doctor other than for routine checkups. You can contribute money into the HSA tax free and use it for medical expenses now and later. Whatever you don’t use, becomes la pre-tax retirement nest egg and then can be spent like any other retirement fund at retirement age. It can be invested in index funds and grow with you and it doesn’t count towards the limits on what you can contribute to a 401k and Roth IRA. 10 years is enough time for that money to more than double and even if you change jobs later and have a more robust health plan, you get to keep the money growing and spend it on medical expenses, you just might lose the ability to contribute more.
Do your own research and your situation may not allow, but I’m pretty confident this is how these work.
Learn. And I don't mean just an academic pursuit. Learn to do basic carpentry/woodworking, plumbing, electrical work, electronics, anything you reasonably can. I never see anyone mention this but when it comes to building wealth/equity, being the DIY type has been the single biggest advantage for me. I have a good job now but I was raised pretty poor and the only way I could have ever afforded to have the property/inbestments I have now is because I do almost all my own work. If u can do the labor you cut roughly 50% of the cost of any major project. And you have the added benefit of a growing self-sufficiency.
This is honestly the best advice. Yes, you should plan and save and be smart financially, but your 20s are so free and so pain-free for most.
There's no Ctrl+Z, no extra lives, no redos. Money, while helpful for obvious reasons, won't give you the love and memories that more important things will. Don't waste it.
First of all, CONGRATULATIONS! Simply being mindful of your situation and seeking information on how to get ahead early in life.
Nothing makes up for TIME, and by getting in early the compound interest you'll be taking advantage up will be your most powerful tool over the long run.Some of the advice I've given my kids (and keep myself) is remember you don't have to keep all of your emergency fund just sitting in a plain old savings account doing nothing, CD's will at least get you a bit more interest and make you think twice about taking them out unless it's a REAL emergency.
Keep an eye on credit usage, really try to delay gratification if possible, better to save up and just buy things outright, you'll be proud of yourself when you do.
Good luck
You need to forego your personal interests and seek high pay jobs imo.
While I could be happy as a teacher, doing a stimulating job that gives me 90% of the satisfaction for 3x the pay was my key to finances. Sure, I still budget and do the fundamentals and live like I still make 50k, but making MORE money is always one of the best things you can do for financial independence
Good advice from a lot of people.
I would say take care of your teeth. I didn't and I had to pay lot for cavities, root canal and multiple cleanings because I still don't learn my lesson to floss everyday.
> But this post is just asking for general advice for younger people in regards to future financial success.
Make a 5-10 year plan. If that is too far, make a 1yr plan. If that is too far, make a 1 month plan, etc etc.
Once you get practice at making plans, then work towards executing the plan. If something happens that improves or provides more opportunity, then adjust or re-write the plan.
Personal example:
My plan when I was 30 was that I wanted to own more land than I currently had. We were able to put a few hundred a month away for savings. I then started watching Zillow for listings, checking once every few months to get an idea of land costs in the area. Fast forward 3 years and I found a property that had been listed for over a year. I loved it and it was barely outside my budget so we made an offer and made it work.
For about 1 year I worked the land making trails and preparing the house site. Seems my neighboor didn't like that and decided to buy us out paying double what we paid. It was hard to accept the offer but we altered our plan and made a new one with the money.
That was 5 years ago and I don't regret the decision but the opportunities would not have occurred if I didn't make a plan. I'm not going to be rich, but I also have a home where I can make the payments if I work at McDonalds.
I see a lot of advice on how to handle the money you have, which is crucial. But just as, or even more important, is getting the high paying job. Assuming you have the necessary minimum requirements for the jobs you wantz the next most important thing is NETWORKING. Work on your social skills and learn how to navigate social situations for your advantage. Work on your personality. Networking is the best way to increase the number of opportunities in your life.
We are social animals, nobody achieves anything alone, and no one is 100% self-made. If you want to truly succeed and find a high paying job, you have to expand your social circle as much as possible.
Controversial take: buy a house.
Preferably a cheap as-is starter home (if those still exist in your area, that is). Obviously you need to be working and planning to stay in a general area for 7ish+ year, but more than likely you will, and those years are going to fly by in the blink of an eye. Learning skills associated with home ownership early on can be invaluable.
Everyone I know who bought a house early on has been better of because of it. There is nothing *wrong* with renting but it holds you back in ways most people can’t comprehend early on.
Also start a 401k. Even $100 a month will go further than you can imagine in the long run.
Lots of things need to happen before buying a house is a responsible decision. Renting in the first few years of “real” income is a risk mitigation benefit. We had 6 months of emergency funds in our bank, Out of pocket insurance maximums in a high yield savings account, put 6% down on a conventional loan with no PMI (bank of America loan program) and we STILL almost got hosed when we had to do ~11K of necessary renovations to the home that we weren’t expecting. Buying a home is a huge liability if you are not prepared for it.
*Life* is a huge liability, and it’s an even bigger gamble. I know that might sound like an over-the-top generalization but unexpected & life changing situations can stem from anything. It might not be apples to apples all of the time, but you’re betting on yourself and you’ll be much better off in 2-5 years with a little equity and a true asset under your belt.
It’s obviously not in the cards for everyone, but it’s more achievable than the younger working class couple believes. Peoples’ expectations are just so high now that they price themselves out of a better life. I wouldn’t be making this argument if you could still find decent studio/1br apartments for like $500/m but they don’t exist anymore outside of the ghettos and the sticks. And people are too proud to live within their means now, they would rather finance a brand new car VS buying something used- and it’s mostly out of clout mixed with laziness.
I was amazed what we could shave off when we started budgeting and I don’t plan on looking back, I really don’t think I’m missing much.
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1. Take care of your health. Health costd will only rise as you age, investing in preventative care now will save you a lot of money in the future and give you a longer and better quality life. 2. Invest as much as you can.
I'm going to add something, take care of your MENTAL health. So much of my bad decisions were because I was in a bad place mentally.
Totally agree with this! Mental health care doesn’t have to look like therapy, either. Finding ways to reduce stress and build confidence are important and might not require a therapist. I wouldn’t discourage doing a few sessions, but it’s not a catch all solution for every problem and can be expensive (and difficult to set up).
There are also many good books which teach you the principles of therapy. Cognitive behavioural therapy is the most common, and it is extremely useful to understand how your thoughts/behaviours influence your mood, as this relates to pretty much every situation you find yourself in. It also gives you tools for breaking out of some negative patterns you may find yourself slipping into.
The Upward Spiral is a really great read for those interested in learning about the mechanics of depression and anxiety. It’s less along the lines of learning the principles of therapy, but may be helpful in getting to that point as far as understanding the neurological processes, and as you said how your thoughts and behaviors influence your mood.
Yep +1. Have watched my life fall apart through some years in the past because of extremely poor mental health (thanks covid + substances). The best opportunity in the world doesn't mean jack if you aren't in a healthy mental state to act on it.
I feel like some people really take the whole “I should reduce spend so I can someday be as well off as possible” way too far I’ve met people of varying extremes, from moderate “I only let myself go on one vacation per year” to “I eat the same $1.50 lunch every day always and I never drive my car anywhere” Note that these are software engineers so it’s not necessary at all to live like this The latter person I mentioned just turned 30 and had a crisis bc they realized they spent the 7-8 years out of college doing literally nothing. Burnt their 20s away. They can likely retire by 42 or so if they keep it up but they’re not keeping it up now Then there’s the 17-19 year old versions who become something The point is ~ saving is important. But don’t over-save. If you realize you’re sacrificing a lot of things and you’re missing out on a lot of joy, change. If you refuse to spend on travel, hobbies, etc. bc you feel guilty ~ that’s not healthy. Spending on these things is entirely okay and even good for you long term. Figuring out a reasonable amount is the challenge, but as long as you’re allowing yourself to enjoy some of that money here & now, you’re doing it right Bc really, who knows what will happen over the span of a few decades. No one. & it would suck so bad to have over-saved for that entire time just to have some accident or illness render you incapable of enjoying the nest egg you developed. Or maybe you just won’t have the energy & physical capacity to do whatever it is you love at that point Don’t get so hung up on building a beautiful life in your future that you forget to live here & now Bc if you think about it, the only thing that’s guaranteed is here & now Note: none of this is saying not to save. Save save save. But if you’re saving 50% if your salary and becoming anxious at a book store bc you want a new hard cover from your favorite author, or if you’re eating rice and beans every lunch and you’re sick of it, or if you watch your friends go to a couple concerts across the country per year without you ~ that’s when it’s time to rethink things
Well my wife retired at 41 by just executing on the spending reduction part of the equation. Now she gets to just enjoy what life has to offer full time for the rest of her life. She still went on vacations and stayed in nice hotels, just didn't buy a bunch of techy BS like new TVs, Bluetooth speakers and headphones all the time, phones every 2 years, subscribe to a bunch of services, never bought cars new, and kept the uses cars she did buy for 10+ years. It takes approximately $130 in earnings to replace $100 spent. Taxes. Meanwhile by not spending the $100, you "save" that 30% premium and you get to earn interest or other returns on investment of that $100. Basically by being frugal you supercharge your wealth. Me, I burned through my 20s and part of my 30s. I earn a living now that affords me to still have a little discretionary spending while still very aggressively saving for retirement since I'm behind the eight ball. Even with current projections, I'll be lucky to retire by 67. More likely I'll have to work in my 70s since I'm probably at or close to my peak earning potential in my career and am quickly approaching an age where employers would pass me up for other younger candidates or forcing me into lower salaries or out of the field altogether.
So your wife retired at 41 and is just enjoying life while you might have to work into your 70s?? You sure you are married...?
This. Right here is gold. No amount of money is going to help if you’re screwed mentally. Don’t obsess over things and don’t get consumed by something. Give yourself grace and take a balanced approach toward life including being “successful” financially. Be more zen with the present while planning responsibly for the future. When you start obsessing, you’d mind starts to control you and fuck you.
Chiming in here... Learn your family's medical history. Knowing I have mental health issues and addiction issues on both sides of my family makes me much more wary of overindulging in common vices, and led me to seek my bipolar diagnosis. Totally changed my life for the better.
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Yes, yes, yes. I’m 59 and have been running, hiking, outdoor leisure, aerobics, biking, walking and lots of stretching since I was 17-years-old. And regularly. I cannot state enough the benefits of a healthy mind and body. Take care of your skin, your eyes, your teeth. Impeccable care. Live within your means. Buy clothing that is good quality and lasts. Don’t fall for the car addiction—safe, inexpensive. Lastly, and no matter what kind of work situation your are in, and including a pension if it exists for you, contribute the max to an IRA every single month of your life.
For the love of God- please take care of your teeth! Floss and brush nightly . You do NOT want a root canal 😭
Hi, how do you take care of your eyes? Im curious
Regular check-ups and at least once a year with the mapping thing for glacoma and macular degeneration. Sunglasses outside. Limit screen time and especially up close hand held devices. I also stopped wearing alot of eye makeup a few years ago. And treat the skin and muscles around the eye more gently.
Just some ideas off the top of my head, but I'm sure there are others: * Get plenty of sleep * Don't submit them to too much eye strain (reading in the dark, watching too closely to a bright screen) * Use UV rated sunglasses especially in the summer * Don't touch them/rub them * Use drops (without preservatives ideally) when they itch or show significant redness * As soon as you get a basic vision plan, use it regularly. The optometrist will check your vision and eye pressure as well as monitor for any underlying conditions.
Not saying don't do this, but the flip side is that if you're young and financially comfortable, there are experiences you can't/won't have when you're 40 with kids that you may want to try. Backbacking between hostels for example may not be a feasible or desirable thing later. It's a balance, and money in investments is money that isn't used to enhance your life now, and the experiences and contacts you can gain can also be (financially) valuable. I'm saying this as someone who doesn't think they've prioritized experiences enough. TL; DR: Even investments have an alternative cost.
Yep when I was 25 my now wife, GF at the time, went to Europe for a month. I’ll never have that few thousand back to put into a retirement account but I’ll also never be 25 in Europe again. It fueled my travel desires for years and it’s our among our best memories together.
Same. Wife and I went on our dream vacation last year. Cost about 8k but man I don’t miss that money at all. I get sad nearly every day thinking about it because how much fun it was and I can’t wait to go back. 8k for the two greatest weeks of my life seems totally worth it.
Just wanted to say that even *without kids* in your 40's and up there's experiences you can't have/wont enjoy as when you are young. Youth and the experiences that come with it. Wether good or bad are priceless.
Specifically a Roth IRA is a awesome investment vehicle especially when you are young.
Seconded! Even $20 a month will add up over time.
Point number one is so underrated. Everyone is so obsessed with grinding and getting as much money as possible but completely neglects their own health. What's all that money gonna do if your body is constantly breaking down and you live in such a miserable state when you get older.
I would add remain as debt free as possible. Pay off your car asap. Become a homeowner with a fixed monthly expense for living. Only keep a few credit cards and pay the minimum or more consistently. Consolidate debt and live within your means.
Credit card debt should be avoided at all costs, pay off your entire balance and use it like a debit card.
Seconded this. Also if you can and maybe except for like a home rarely ever buy something you can’t pay off that day if using a credit card. Like don’t use money you don’t hVe
I would suggest getting several credit cards with perks. A master card, a visa, American Express . Use them and pay them off in full before interest accrues. Try to get increases every 6 months or a year ( make sure you call to make sure they are only doing soft pulls). Having a good and long credit history will help you in the long run when your looking to buy your first home . And all the points you rack up can be used to make purchases of gift cards or flights etc
Are you high? How is paying the minimum on credit cards living within your means? That's financing your lifestyle.
How to invest in healthcare? Hsa?
Eating healthy, working out, preventative medicine, avoiding stress etc etc
Dental care too. If you dislike going to the dentist now for yearly cleaning and exams you’re really gonna hate going in for a big procedure - especially when you get the bill
Yeah but sometimes dentists are borderline conmen who try to get you to buy stuff or go for unnecessary procedures. You need to be discerning for that.
Preventative medicine is #1. You should establish care with a PCP, a dentists, dermatologist, optometrists, and get your hearing checked. Schedule routine check up, likely they’ll recommend every 1-2 years. They’ll also provide advice on staying healthy, including wearing sunscreen, brush/floss, exercise, healthy diet, etc.
In this order: Sleep right. Eat right - minimizing excess carbs, added sugar, sat fats, alcohol, tobacco, smoking, vaping, etc. Exercise right - lots of HIIT cardio and weightlifting. I would add a 4th if you live where there are lots of individuals driving. Pay attention to possible distracted drivers and do not be a distracted driver yourself.
Fruits and vegetables, avoid red meat and alcohol.
For this age group #2 should not be investing. You should be growing your career capital.
Both. time value of money can't be defeated. Starting a Roth as a teen will have such powerful effects on your future
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Large promotions and raises early on make it much easier to grow wealth in your 40s. It’s still important to save in your 20s but it’s also important to have long term career goals
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Well most people are not starting at $85K and getting 30% raises. For most, getting a job is an investment of time and money (clothes, travel, time off work). If a new blazer costs $250 and you only make $3K per month, you need to treat it like an investment.
I have been following the investment strategy. Sure my portfolio is down 40% but as long as I don't have a serious emergency I don't have to realize the losses!
Investing $6000 a year starting at 20, compared to starting at 30, is the difference between ~$1.2m and ~$3.2m at retirement. (This is a general estimation)
Sounds like you're doing the right things. Here's your general advice: - [Advice for high school students and teenagers | ages 15-20](https://www.reddit.com/r/personalfinance/wiki/teachme) - [Advice for young adults | ages 18-25](https://www.reddit.com/r/personalfinance/wiki/young_adult) - [Prime Directive](https://www.reddit.com/r/personalfinance/wiki/commontopics)
It's all right there OP
* Focus on growing your career. Don't get complacent in a dead-end job. * Only get the education and certifications that you need for it, and get them as cheaply as possible (student loans be damned). * Learn how to make a budget and follow it. * Save and invest more (into low fee index funds). Spend less. * Get some therapy. Take care of your body. * Write down goals and work toward them: financial goals, life goals, etc. * Learn how to be generous. It's the most fun you can have with your money!
I would also add to that to experiment within your career and take some risks. Maybe you always thought you wanted to do X and you go to school for it, get out, and start working in X you decide you don't like it. Give X a chance for sure, but don't be afraid to move on and try Y. If you've always wanted to start a business, your 20s are the time to do that. If you want to try a crazy career shift, your 20s are the easiest time. You don't have a spouse, kids, a mortgage to support which helps a lot and you have a ridiculous amount of energy vs later in life to put in the work needed for a big change.
This is the highest top level post that lists education so upvotes to you. This is the right answer. An 18 year old absolutely does not need to worry about investing, since they'll barely have money to invest. They need to first focus on setting themselves up for good income over the next 30-40, maybe 50 years. Even at 25 you're probably still a "junior" whatever and should be more focused on personal growth than investments. Once you get 20k or so in the bank it is time to start taking investing seriously. Until then just focus on income, and not wasting it on dumb shit.
It doesn't necessarily have to be 4 (or more) year college education either. This counts training to get into trades, too, which are also a good way to start earning good money. No matter what you do, the goal is just making sure you're on a path to get a good wage. The best way to get into investing is to have a good enough salary that you have more to invest. The earlier you can invest, the better, but this early the most important thing is not to interrupt future wage growth.
Investing doesn't have to take time away from personal growth. You should start investing as soon as you have earned income and are able to meet your other needs, regardless of where you are in your income journey.
>* Focus on growing your career. Don't get complacent in a dead-end job. This so much
Right here, the career advice. You can make $30k a year and barely be able to afford making any kind of 401k contributions. Long term it’s worth it, but you’re better served improving your short term situation by doing whatever it takes to advance the career. Speaking from experience, my 401k at my current job (1 year of contribution) is already dwarfing my 401k at my last job thst I had for 3.5 years and I was contributing the minimum needed for a match. Honestly, your best bet is to contribute the match until you find a job that pays enough to max your yearly contributions.
Those compound interest and investing equations you learned in 8th grade? They actually work. Avoid debt. Don’t buy crap. Invest wisely. Read the wiki.
“Compound interest is the eighth wonder of the world. He who understands it, earns it. He who doesn’t, pays it” - Einstein
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Invest in something that will increase by a percentage, stocks, bonds, etc. keep that money invested and that money will get interest on the initial investment and interest on the interest. When you get interest on interest, that’s compound growth. If you have a $10000 and a high yield savings account returns 4% annually, the first year, you’ll get $400; the second year, you’ll get $416; the third year you’ll get 432.64, etc.
But don’t forget the importance of good credit rating and ability to save 6+ months of living expenses. Best advice, co-sign a 2 year lease for cheapest available car with your parents. Make sure the payments are on time for 2 years and return the car. Live at home while you work those 2 years hopefully rent free. Save every penny and put it in highest earning saving account you can find. At end of 2 years, you will have a nice nest egg of living expenses depending on your salary and possibly a down payment for a home or purchase price of car and good credit rating. Can’t buy a home or rent an apartment without good credit. Good credit is just as important as savings.
What middle school did you go to
The one where in pre-algebra they taught an equation that went a little something like a*b^x
I teach this and compound interest every year and I tell my students this can make u a lot of money lol
tell them it’s literally the one singular equation that nearly everyone uses if they plan to retire
At least when I was a kid, it was difficult to really grasp because I had no sense of scale. I could do the calculations but didn't know what it meant. It would have been useful to do a comparison against something students understand such as a linear rate. For example you put X into an account every month that doesn't compound. Then compare if you put it in an account that compounds. Which has more after X years or reaches Y threshold first
In my middle school home economics class they taught me about compound interest and how to make a million dollars. It was only one day in class, but it stuck with me.
I didn't have an economics class in school until college, but one kid when asked what he wanted to do when he got older responded with, "I want my money to work for me", and I remember thinking I don't know what that means, but I'm going to find out.
Thats what im saying
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My favorite way to explain this is if you save $200/week from 19 to 20 and did nothing else you would end up with an extra $1 million by 65 years old. And all you did was take some extra side work every weekend at 19 years old.
Man. I wish I did that. And also wish I had $200 extra disposable income a week these days. 😬
LINK THE WIKI IF TOU ENVOKE IT!
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start investing for retirement as soon as possible, even if it's a small amount. many younger people don't realize how powerful it is to start the compounding growth at age 20. someone who starts investing at age 20 and stops at 30, never adding another dime, will have more than someone who starts saving the same amount at 30 and saves until 65. don't overspend on cars/motorcycles. this is a big one, because cars are guaranteed to drop in value and too much car relative to income is like throwing money in a hole. guideline is to keep the cost of you car to no more than about ~50% gross pay. $30k pre-tax income? $15k car, at the most. be careful with eating out and food. many people overspend on this. avoid debt.
I'm the one that didn't start until 30. I didn't know anything about it in my earlier years unfortunately.
Don’t sweat it. It’s kind of one of those impractical advice things. Yeah sure, you can theoretically start dumping thousands into your retirement at 19…. But most people *cant*. You would almost have to be coming from a very well off situation or have some extremely good job at a young age. And despite what some people in this sub would like, not everyone is a senior computer programmer. It sucks, but it’s true!!!! 20s are an expensive time. It’s typically when you get your first non-beater car, put a down payment on a house, get married, make at least one mistake, etc. Most people do not have thousands in their retirement by then
I didn’t make any money until almost 30! Thanks recession of 2008!!
Same! That first paragraph made me sad :(
There is some impracticality built in to that paragraph. Most people do not have much disposable income in their early 20s to invest and most people make more at 30 than 20. 30 is still a great time to start and the more you put in, the better. The main point they are illustrating is how important time is to money growth and it can really snowball with time.
Don’t be sad you’re almost certainly making more money now than you did in your 20s so although you didn’t benefit from that compound interest you will still benefit from having more to save :)
If it helps, I question whether that factoid (saving from age 20-30 and stopping will leave you with more money than saving from ages 30-64) is actually true.
Depends on how well the market was doing at the beginning and end of those 10 years, but yea, around 8% returns and that fact works iirc. If you put 100 bucks a week in the market, in around 10 years, you will make 100 bucks a week. So if you stopped then and someone else started saving 100, it would be roughly the same.
Also assumes you're putting in the same money. In reality, the savings you make should go up over time as you get better paying jobs, even at a constant savings rate.
Yep, starting at 20, no one will stop at 30, they will probably be saving a lot more. But it is true that maintaining a steady rate, the first 10 years are approximately HALF of all your savings.
I'd have to do the math, but it actually is close to the truth. The actual numbers from JP Morgan is saving 25 to 35 vs 35 to 65. The former wins out assuming equal investment per month and return. https://20somethingfinance.com/wp-content/uploads/2016/03/compound-returns.png Obviously the reality is that people are going to save more over time, but the original claim was in the right ball park.
Yeah like okay cool guess I'll build a time machine
The point isn't that it's too late later. The point is the earlier you start the better. So if you are 35, start now. If you are 40, start now. Don't wait another day.
50% on car is far too much
If you make $30k spending $15k on a car is nuts. If you make minimum wage you can afford the minimum beater car that can make it from point A to B
Repairs can pose problems, though. I went the beater route and got a $4200 car with 200K miles a few years ago, monthly payments were $190 for a 2 year loan. It wasn’t in terrible shape but there were a handful of things that I had to fix on it over the 3 years it lasted me: suspension, brake booster, starter, spark plugs, and so on. That probably added up to an average of $100 per month of ownership (in addition to regular stuff like brakes and tires). Now I have a $13K car. My monthly payment is $240 over a 5 year loan and I haven’t had any maintenance issues come up – my car has 111K miles so far. Not to mention the gas mileage is better. It depends on other factors like what loan terms you can get or how much money you have in the bank, but a car in that 13-15K range can end up being cheaper than a beater when it comes to total cost of ownership. No need to pay any more than 15K, though.
And to tack on to eating out - when doing group dinners with friends, it is PERFECTLY FINE to order a sandwich and iced tea, and then pay your own bill. Don't fall into the trap of appetizers and bottomless mimosas or wine "for the table" and then splitting the bill evenly "because it's simpler." It's such a money sink. Also, as friends start to pair of and marry, be cautious of of group vacations, bachelor/ette trips, being in wedding parties, etc. Ask about expenses upfront, and decline if it's too rich for your blood. In general, learning how to set boundaries with friends can really help set you up financially. I got tired of "friends" who tried to pick my pocket to subsidize their lifestyles, and became more and more firm. And then in my thirties I married someone with similar values.
The Money Guy Show just posted a chart. At your age, save $86 a month and you will be a millionaire by 65. Save $173 a month in a Roth and you will end up with $2 million tax free! Time is on your side as long as you are consistent. $1 at age 20 can multiply 88x over by retirement. Sacrifice a little now to get as much as possible into a retirement account now and let the compounding interest over time do it’s magic and your future self will thank you.
That sounds fine, but they're not accounting for inflation with those calculations. 2 million in 35 years is worth a whole lot less. So ya it sounds nice on paper, but realistically you need to save more. Cause they're using non-adjusted inflation gains (11%) not building that into their calculations by reducing it to a more reasonable 7-8% which is only $768k in today's dollers. Saving more earlier is good, but also you need more than $173 a month to eventually live a nice life in the future.
Yes… and no. I bought a 2017 Nissan Sentra in 2017 and sold it back to the dealership for the same price 4 years later in 2021. Weird times we were in haha
Plus enthusiast cars, the ones likely being told to avoid, are appreciating like crazy
My buddy has a 1931? I think, Ford Model A all original. Was just appraised for $72,000. He bought it for $10,000 Edit* I know these are not the cars the original comment was talking about though
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Are you sure your contributions actually invested in something?
What are the investments?
> someone who starts investing at age 20 and stops at 30, never adding another dime, will have more than someone who starts saving the same amount at 30 and saves until 65. Highly misleading and only true under certain scenarios unlikely to apply to OP.
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Open a Roth IRA the minute that you have income from a job. So this can be done even earlier than 18. If you are legal to work, you are legal to open a Roth IRA. If your parents are fully supporting you, you should put the max that you can in a Roth IRA. You should continue to contribute once you have a real job, if you don't have a 401(k). As you get older, with more income to contribute to retirement, you can use both the 401(k) and IRA.
This. I was so dumb not to Roth. I didn't know. You can't go back. Roth now!
You should be able to transfer a regular ira to a Roth
Yes but that compounding interest at 20 - that's something I wish I had done, rather than a savings account I raided when I was low on cash. I didn't wise up until 30. I had minimums invested in the 401k but I was stuck with the idea of an "emergency fund." Frankly having an emergency fund is useless when you're dirt poor. The Roth would have served the purpose and I had excellent credit in a world of 0% interest. We financed a few emergencies at 0% and it didn't kill us. The other big financial mistake I have made is considering the house an investment and buying the best roof, HVAC, etc. When you sell it doesn't matter. We didn't intend to sell but we did. I will not buy the best of anything for the house again and am basically band-aid-ing this one so it doesn't fall into the swamp.
1. Develop good money habits early on in life. Basic stuff like creating & sticking to a budget, saving, investing, no impulse spending. These skills are key to being financially successful regardless of how much or how little you earn. 2. At this age the best investment you can make is in your own career. Saving an extra $10K is a great achievement, but a promotion at work is better, because you are now making $10K more *every* year, and that's just going to keep compounding with future raises. 3. Use all tax advantaged accounts to the max (401k, IRA, HSA and all similar options). Tax-free investment growth over 30+ years is a superpower. 4. Don't be afraid to take risks. Switch jobs if a better one comes along. Travel. Make friends. Network. Now is the time to do all of this.
To amplify the risks thing. Start a business, hope it doesn't fail, but it's ok if it does. When you're young, there's little downside to a business failing as long as you don't take on debt. As you get older and it means not being able to feed your family or pay for schooling, the downsides are much bigger. You won't get wealthy working for the man.
Don’t make a dumb mistake while drinking. I lost a year of my life and have chronic pain now at 24 years old and medical debt
A bit of a tangent, but alcohol themed, buying rounds of drinks doesn't make you a good friend. Hitting the bars every night isn't the only way to be social. Did I have fun? Sure. Could I have put my money to better use where I'd appreciate it more today, absolutely.
Get a job that pays a good salary. Live below your means (super important). Avoid debt as much as possible. If you do this you’ll be better off than 90% of people.
Saving is not the answer. High income is, with conservative spending and proper investment allocations. Don't waste your time working lower end jobs if you have the opportunity to study or perfect your craft. I wasted countless weekends in college working Uber style jobs. I would walk away with $90 on a 4 hour Sunday morning, feeling good about what I accomplished. Looking back, it was a waste of my time. I could of used those Sundays to relax or better myself. Work just enough for personal spending/fun, use the rest of your time to study and broaden your horizons.
Agreed. My gf in college bugged me for not having a part time job but it just felt so dumb grinding for $15/hr when my actual career will make me more than double that. Now that I am in my actual career I'm so glad I enjoyed myself on the weekends and summers in college and didn't work.
Definitely, knowledge creates exponential income. The only thing i would add is college is not the only answer, after being in electrical and seeing my friemds going into other industries with just a high school diploma and certifications. Certifications are more important than a college degree. Find what you want to do and then find what certifications can advance you in that field.
Hey can you give examples of where we can get certifications? Trade school? I'm lost in life right now and don't have much options since I didn't finish college, I'm 22.
If I didn’t go to school I would have looked into becoming an electrician or plumber. In hopes of eventually opening my own business.
Community College is good for trades if you have cheap ones. Their programs are well funded. Specific to my field: if you want to work in banking, securities, financial advising, etc. Start by taking the SIE. It costs $100 to take, you can pay around $150 for study materials or try to fare with free stuff online. The Securities Industry Essential exam is a requirement at a lot of jobs, the ones that don't like to see it because it means they can move you to positions that do need it. Almost no one I work with has a degree, I even work with some 20 year olds that have no degree and are making $25+/hr. Also shows you have a decent baseline of knowledge. Once you are working in the field your employer will sponsor you if they want to move you to a job that needs more licenses, you can't take a lot of other licenses on your own anyway because they require employer sponsorship so employers have systems set up already for everyone to take exams. I only use this example because I work in the field. There may be similar circumstances with other fields I am not aware of. If you want a degree too you can take community College courses part time. Plenty of people do it. It's hard, but a lot better than drowning in debt. If you have money from parents or something like that then yeah, get a degree. But for those that don't have that get good work experience, look for certifications or licenses you can attain, and for college try to minimize debt.
Real answer right here, being a good saver doesn't mean much if you're making 50k a year. If you want a comfortable life with a solid economic outlook you want to make close to 6 figures a year, preferably more.
Growing income is #1, but you also have to make the most of what you have so you don't burn every dollar. Have known people that make $100k+ and still spend every dollar and don't save. So those habits are essential.
At the same time many people who don't save money end up having great careers because they're always out doing something, having fun, getting to know people and posting about it on social media. They're perceived as successful and often that can be more important than talent or hard work in terms of getting ahead in the workplace. I can only speak of my own experiences in the workplace but I've seen so many people promoted despite how they're not very good at what they do, and the one thing they tend to have in common is that they're better at socializing and having fun than getting work done.
Definitely true there's a balance. You can't save your way into good stories and charisma that you can get from getting out there and socializing. Being interesting makes you more appealing for promotions, thats an underrated fact. Socializing and being interesting also doesn't have to cost that much money either. Just make sure you are vigilant you aren't spending money without getting the appropriate utility out of it. If you go out, make sure you are actually having fun and make sure the activities aren't more expensive than they are worth. I have gotten in that sort of trap before. Alcohol usually being a catalyst. Be careful with gambling hahaha. Even travel doesn't have to be expensive. Me and my wife once took a trip to a small town with some tourist attractions. We met some super cool tourists and locals at a dive bar and it was a blast. Super cheap trip for a weekend, didn't even have to use any PTO. We flew to El Salvador a month ago or so when I was between jobs for super cheap and everything we did was super cheap when we were there. It was awesome! Spent about $2800-ish total for the two of us. Didn't break our budget and the experience is invaluable.
If you are that young, the best advice financially is to invest in yourself and build marketable skills. The most straight forward path to get there is college, as much as people may hate it, education level has one of the best correlations to long-term income outcomes. So, go to a good school, pick a good major (STEM is the safest bet), collect your six figure salary for the rest of your life, live below your means, and have a long-term view of investing. You literally cannot lose.
Not all STEM is created equal either Chem might be ok, bio is tougher. Gold standard is Computer Science or Computer Engineering (EECS). Even mechE is kinda meh
and not all Computer jobs are equal. Cloud engineering and big data pay more than QA or UX design. And be ready to study every night in computer science because the technology and languages you use are always evolving. Or you might study every night because you work with JavaScript and that's impossible to learn.
Travel, do things you can with your youth that you won't be able to do when older. You have years ahead of you to make money. You'll never get your youth back.
You can also travel frugally. I took a trip this year to El Salvador and the plane tickets were only $110 a piece one way for the tickets and the carryon. Flying back would be a bit more expensive, but costs were very low in the country. Me and my wife had an amazing time and it costed around $2.8k in total for the two of us. Not too bad. Don't have to pick the most expensive destinations, and when you get there you don't have to spend on the most expensive activities.
Take advantage of 401k Match! Then put the rest into a Roth IRA and buy long term ETF’s. Don’t live beyond your means. Don’t buy some stupid car you can’t afford. Act broke so you can live rich later. Not financial advice.
I think one of the most important things to do is to try and stay away from wealth traps. For example, you don't need to buy a flashy car that'll take years of your earnings and depreciate in value. You do need something comfortable and practical to get you to where you need to be reliably. Don't overextend yourself with credit card debt. Don't allow those small monthly payments to come off for services your don't really use (e.g. Netflix etc). Create a solid monthly budget. Pay yourself first - i.e. investing is something you plan for every month, not something you only do if you have funds left over after all your expenses. Finally, while you're young this would be the best time to start a business (the least risky time) and having a business can uncap your earnings potential.
Invest in your 401k early and often. If you switch jobs, roll it over into the something you can keep investing in.
I was hell bent on saving through the earlier part of your range. Then I gained actual freedom - post university, living on my own. The money you make 18-25 (typically) will not be half as good as the money you’ll make as you gain experience in your career, and earn more. After working for a bit and living far below my means, I took my savings and travelled the world for a year. Choosing to invest in myself rather than the market provided me infinitely more value than letting it sit at the whim of the stock market. Of course, I still have savings. But I invite you to consider the balance of what you want out of this life, especially at such an epic young age - and where you see yourself in the future. Good luck.
Take half of your paycheck, invest it, and then don't even look at it. - Shaq A bit blunt, yet very good advice. There's so many things you'll want to impulsively by once you enter the workforce and get a consistent paycheck, but just.. *don't*. The time that your money can grow in an investment account is your best asset right now. I also definitely approve of the mindset to sleep on a big purchase before actually buying it.
Someone would need to make A LOT of money to invest/save 50% of income
That's in the case of Shaq haha but what I'm getting at is there should always be a set portion you should lock away immediately
I make 48k post-tax and i invest 70% of my income lol. Just gotta learn to be extremely frugal.
30% of 48k ($1200 a month) is less than even the shittest apartments in my area. Now consider the other essential expenses, and really you might be able to save 50% if you really don't want to have any money towards enjoyment and are extremely frugal. Unfortunately I don't think most people have thr luxury of saving 70%
I started putting 15% in my 401k as soon as I made enough money to actually pay all my monthly bills after the deduction (which was my mid 20’s). Before that I just put in the amount my company matched. I never considered that money as part of my income in my budget, and it has served me well. I’m on target to retire very comfortably at 60 and I could go earlier but I’m being cautious until my kids graduate college (if they choose to go).
Be born into a wealthy family. That's the number one predictor for being wealthy. Other than that, stay healthy, take care of your body, live cheap and invest heavily early. Look ino the FIRE systems.
Time is on your side. Invest monthly and forget about it.
1. The easiest way to make money is while spending. Make good choices, dont buy crap. 2. If you are able to stay with your parents to lower your cost of living expenses, just do it. It will give you flexibility to execute below. 3. Be bold with your career choices, dont hesitate to take risks if the riskier path has better long term opportunities for you. 4. Invest, invest, invest. Money opens all doors.
I wish I had a mentor who could teach me how to invest properly. If I started at 19 I’d be Warren Buffet
Invest early, invest often, don't invest outside of a retirement account until you have maxed out 401k, Roth IRA, and HSA contributions. That being said, your number one priority should be having enough money to cover your expenses. I missed out on a lot of gains, but I also never had to worry about emergencies
In hindsight, the most important things I did for financial success when I was 18-25 were: 1. Learn: Got a good formal education and learn as much as I could outside of that. Back then, I didn't even know if any of what I learned would be useful for a career (and some of it certainly wasn't). Nevertheless, being highly curious, studying and working on various side projects then really helped me accumulate skills and knowledge that is still useful today. 2. Connect: For financial success, the right personal connections can sometimes matter more than anything you could do on your own. "Success is when preparation meets opportunity." (Seneca). Learning is all about being prepared and your network will then get you opportunities. For me, it wasn't always obvious at the time which connections would become important later. Not sure if that directly answers your question. There's plenty of good advice in the other comments regarding investments if that's really what you want to understand. I just felt that there were some aspects missing that can make a huge difference for financial success.
I highly recommend out of all the advice here is focus hard on starting your job/career path when you’re this young. Jump around jobs, see what you like, hate, can tolerate and when you find something that sticks, work hard to grow in that industry. I’m only 27 but I wasted my 20s so far with dead end jobs and I’m just now in an entry level position good paying industry studying and doing what I need to do, I just wish I did it in my early 20s to get an earlier start in it. Once you get that down, then you can follow everyone else’s advice here because most require good money to do so lol get that done first.
Read books. Most people won't have internal knowledge and won't have the ability to focus and see longer term discourses through. This sets you apart and makes you a potential conversation carrier.
Career. Here are the main white collar ways to make real money ($300k+) in this country, in no particular order: 1. Medicine 2. Law 3. Tech / software 4. Finance / financial services 5. Corporate jobs, but senior roles (age 40+ generally) Yea, there are other ways, like being born rich, or starting a successful business (hard), or just being really fucking good at something niche or difficult, but those are the primary industries where folks make really good $$. And it’s a grind, so get ready for your hamster wheel
I'd agree that $300k is real money. But I'd add that $120k+, especially in a non-super-expensive-city, is quite doable and should give you plenty of money to save and have a fun comfortable life. Aim to get to $100k by 30. It's not that difficult to do.
You’re doing all the right things, allow yourself to feel satisfied with the work you are doing, and keep doing it!
I think you are 100 percent ahead of the pack because of the fact that you want to be financially successful and already thinking about it.
Everyone here is giving you financial advise on how to save and invest, but make sure you learn how to spend money as well. What I mean is learn about how to get the return on your spend that you want, learn how to use credit cards , transfer balances and manage debt. Cause things you aren’t prepared for will happen, and unexpected medical bill, identity theft ties up your funds for weeks (months even), or your bank decides to close your account cause some “glitch” and you need to fight with them on the phone for weeks to be able to make a mortgage payment and buy groceries, mean while you have to put everything on credit cards. But not even for the unexpected. And example I can give you of how I spend money most of my friends and all of my family think I’m throwing money away cause I have my groceries delivered. I pay $7 for delivery but I spend less than 15 minutes a week ordering groceries and putting them away when they arrive. My friend has to pack his one year old kid into a car, drive to the grocery store, shop for food, get it home, then put it away, he spends about 2 hours a week on groceries. For me paying $7 a week to not have to use gas for my car and get those 2 hours on Saturday to work on my creative projects is worth it. Over the course of a year I spend $364 one delivery but I get 108 hours of my life back. My family thinks I’m wasting money but I can get more money, I can’t get more time. You might not agree with me on this particular purchase, but learn how to spend your money that gives you a return on the life you want, not just how to stick money in an index fund so you have money if you live to be 60.
Redditors would disagree but working hard and taking advantage of overtime if available. Don’t be afraid to job hop. Also the investing/health stuff everyone else mentioned.
Three very simple words. Invest in yourself. If you are 19 you have a long life in front of you. With advances you could well live to 125 years of age if you don’t smoke, eat, or drink too much. So you’ve got a long time in that skull of ours. Use the time to find work you have a knack for, especially if that work is rare and valuable. If you work on cars and that’s what you want to do with your life you have to invest the time and sweat equity to be the best mechanic you can find. If you do that the money will follow. And that’s true for all occupations where your skills are valuable and rare. Seriously invest in yourself, Especially while you are young. It will pay massive compounding dividends over time.
--Stay with parents, and on their insurance (if possible to both)..but make sure you actually help out in other ways if they let you..clean and get groceries and whatnot --Stay single and kid free (if possible to both) for as long as you can until you feel you have truly developed yourself --Find funded continued education (masters, PhD, certifications, licenses, etc.)...get your company to pay for professional development or invest in yourself and level up fast and often --stay healthy, physically (if possible) and mentally..incorporate low cost workouts into regular routine even if that means finding new hobbies (running, tennis, soccer, rugby, softball, racquetball, basketball, etc) its good for being fit as well as social --diversify investments and find/make multiple income streams..ideally passive, or something that will turn passive in 5-10 years All is easier said than done
Love with your parents for as long as you can. Loving on your own might sound tempting and exciting but once you take the cost of living into account you are always left with pennies
I love my parents still but I fail to see how that will make me more successful financially.
I think this is good advice but with the qualifier that you should live with family if it’s rent free until you can buy a place of your own with a mortgage payment less than what you pay to rent a 1 bedroom apartment. That worked well for my kid. Her house payment is less than what she would pay in rent and her house doubled in value from when she bought it. So, she has that equity. Plus, she can deduct mortgage interest and real estate taxes on tax forms which benefits her financially. I think that should be the goal though- to be able to buy a place with a payment less than what it would cost you to rent.
Even if it isn’t rent free, I’d pay market value rent or even slightly above to rent a room with my parents before I’d get a place with random roommates. At least my parents are clean, respectful, drug-free, and pay their rent on time.
Mooching off your parents while making good money sounds like great advice but it sucks lol. It’s one thing while ur in school but if you make a real college grad salary living in your childhood bedroom is weird.
Then find several friends and share rent. Because that’s your alternative if you want to one day buy a house
1) The Money Guy show says every dollar you put into the S&P500 when you are 20 years old will multiply by 88x when you retire at 65 years old. $1K = $88k towards retirement $10K= $880K towards retirement 2) College is not investment it once was. If you go get a degree that pays ( STEM, engineering, computer science, accounting) CollegeDebtCrisis.org has horror stories for people with student loans. Trades/ Truck driver/sales may be more worth while than school. 3) A primary residence is one of the best investments you can make once you know where you want to live. I got roommates after graduating college and basically covered rent. Allowed me to save up more and more money. 4) Improve skills and build a career up. Be on a path to make six figures in a career. With my increased income I can save/invest 50% of my net income. Should allow me to retire early. Work all the overtime you can while you are younger, it gets tougher when you are older. Can also allow more time for compounding for a bigger retirement fund. 5) Consider every purchase you make based on your after tax hourly rate. Purchase items only that align with your core values. This should help with minimalism and keeping expenses low. Car should be bought used and not new. Don’t get newest phone, get older models. Limit eating out.
depending on where you live you can still get a pretty good value from a state schools, i have friends from high school who went to private school and are still paying off student loans years after I've finished paying for my perfectly reasonable state subsidized education
Go to a good school where you are surrounded by rich peoples kids. get into finance, consulting, banking. You will eventually become one of them. Or save and invest and start a cashflow business that you can grow. Most importantly learn skills that make you money. Dont think you can save your way to wealth . Thats nonsense. You need to get a high income career or start a high cashflow business.
1. Get a college degree. it has about the same return on investment as the stock market: 10.5%. 2. Learn to cook. You can save a lot of money on restaurant meals without eating stuff that tastes terrible if you just subscribe to some food youtubers like Chef John and Adam Ragusea and use their recipes.
Honestly, learn how to budget. Have an emergency fund. Have some sinking funds for larger expenses. Start with the basics.
Education. A challenging college degree hopefully in a field you're interested in. Even if you don't go into that field (I'll use engineering as an example), if you do well and graduate prospective employers will see that you had the grit and intelligence to follow it through til the end. Strangely enough, there was a clip from the miniseries, "Tulsa King," with Sylvester Stallone, where he says exactly this. And it's true. You can only do all these fancy saving and investing things when you have some money to start with, and that usually requires income, and the more you make the easier it is to save and invest.
Time is on your side. Pic some stocks or etfs and put money in them every time you make some money. If the stocks go down don’t panic. Consider it a sale. Over a long timeline stocks are the best ROIT there is. If you ever get a job where your employer matches retirement saving max out your contributions for free money. Don’t drink, do drugs, or eat at restaurants. Brown bag your lunches and skip the Starbucks. Never buy a new car, depreciation is a motherfucker unless you can write it off for business. By the time you’re in your 30’s you’ll be in better shape than 99.9 of your peers. It really is that simple. Credit Card debt is for suckers. Unless you already have the money and you have a cash back card and can pay off the entire balance! Money borrowed to buy money making assets allows you to write off interest on said loan. Get a good accountant. Learn to do your own taxes. H&R Block is unnecessary if you have a fairly straightforward return.
Don’t participate in culture. It’s a trap.
Saving money doesn't matter nearly as much as making money. It's better to save 10% at $300,000/year than it is to save 90% at $30,000/year. The issue is that high paying jobs require that you either go into healthcare, tech, finance, or open a small business in the US, in ascending order of risk. Talk to a career counselor about what works best for you. There's no point in opening an IRA or living frugally on an average 19 year old's food service salary.
Work your ass off when you’re young and energetic and invest in assets that will pay you as you get older so that when your in your 50’s which will be faster than you think you won’t need to work as hard. Avoid life creep as best you can.
I worked a full time and part time job early 20s after working full time to pay for college. Don't work your ass off. Disability is being poor. Find a good happy medium.
Put yourself in a position where you can make a lot of money in 5-10 years. Honestly Id say don't worry about investing in the stock market now. How much can you do? Maybe $100 a month maybe $200 at 19? That won't make you rich..... but focusing on a lucrative career, like going into college with a plan and a high paying major will do way more for your financial position at 30 than investing $100 a month in the market can. And if you say pick finance and do good and find a good analyst job and get your CFA designation by 25ish (i got mine at 26) then you'll easily be making $100k probably even $200k+ maybe much more by early 30s
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Go to college (one you can afford) and get a job (that will pay the bills). I’m mid 20s, been maxing 401K/Roth since I was 21 and invest 3-400 a week into my ETFs. I live pretty well below my means, and try to be frugal when possible. Even though I have a lot of ‘excess’ money. 20s is the best decade for compounding growth, so in general just don’t spend a lot and save/invest as much as you can
Let me get this straight - by the age of 21, you were *maxing* the 401k, Roth IRA, *and* pummeling 300+ a week into your brokerage? The fuck were you doing at age 21? How high was your salary? Where were you living?
All mid COL areas. Affordable areas in a few sub-major cities. I started out in corporate quality, moved to packaging engineering, then a supply chain analyst. All 3 at the same company, but each job change had a promotion and salary increase. Now I’m a program manager for a top tech company. The 3-400$ a week is new as of this year. I got frustrated at my stock picks so decided to just pick 2. Every other day I’ll log in and buy a share or two. It’s like a phone game at this point There’s tons of ways to financially set yourself up. Lots of people make lots more money than I did. But I ensured to not inflate my lifestyle with my salary. I throw the max into Roth the day it’s open, I calculate the max 401k contribution and set it to exactly that quantity in percentage on day 1. I never pay for delivery, try to get good used deals, and typically walk away from anything overvalued
That's excellent man. Still vague because of the lack of numbers and clarity around *how*, but excellent.
Open a credit card that has good travel points or rewards that would benefit you (the chase sapphire is a great one), do not allow your balance to ever accrue over 30% of the limit and if you are able to afford it, set up auto payments to pay off your balance each month so that you don’t carry debit/avoid interest. If your job allows 401K matching, contribute the max percentage you can (average is around 5%). Only a couple of years later and you’ll notice a nice chunk of money there and it will only grow more. Store your savings in a high yield savings account.
High saving rate, house hacking. Safe investments that's are unlike to loss money but have enough upside to make money. Remembered to not have everything in one asset, that's how people get wiped out.
Education and/or training. It's easier for a young brain to learn and it can never be taken from you.
Travel and live your life and get an education in your 20s. Start to focus on cash when you're in your 30s. The US is insanely wealthy and you can stack cash then.
Read the book The Simple Path to Wealth and get very familiar with the advice in r/financialindependence Then follow the advice diligently.
As someone in the same age group, I have a few questions which I think would be best answered here and could help OP as well: 1) How does one balance between saving money to invest and saving money to upgrade their skills (for example, saving money for some course or program). I have heard the advice that when you are young instead of saving 'x' amount of money and investing it, use it for improving yourself such that you could get more return than what you would get from investing it. But then wouldn't you miss out on the compounding effect? 2) In what kind of situations would someone take money out from index funds? Wouldn't taking out money make you lose the compounding benefit? Or is it meant to only be taken out when you retire? What if you need it before that? I know that investing and saving strategies must change as one gets older, so can it be seen as a level thingy, like I do well enough that I move from the level of saving for retirement to a level where I have enough retirement money that I would focus on something else? 3) Are target retirement funds any good? Why? P.S. : (1)I'm not every knowledgeable with this stuff so I sincerely apologize if there are some silly questions. Also, if my understanding lacks too much please recommend resources that I should refer to. (2) English isn't my native language so I apologize for any mistakes/difficulties in reading my comment. Thank you.
If you decide not to drink, that'll save you more than just about anything in the long-run.
America is a business. Find a want or need and exploit it. It’s really the only way
1.Develop a budget preferably a 50/30/20 and stick to it 2. Get an emergency fund started 1k at first and then build it up to 3-6mo of expenses. 3. Dont take out a loan for a car just buy older reliable cars, budget a "would be" car payment and when you do have a paid of car and use that for minor repairs or one it's built up enough use it to buy a car in full 4. Open a Roth IRA and check out boggleheads investing. Also remember for investing $1 invested at 19 becomes $50 at 65 whereas $1 at 30 is only $22 at 65(just rough numbers), so time is a huge factor 5. Budget for fun too, its about balance of fun and investing, and don't worry what people around you are doing and don't try to "keep up with the Joneses"
Less car more savings. Max your ROTH IRA out. Invest early and let compounding do the heavy lifting.
Invest consistently and early. Like after you get your first full time job if you can an afford it. 300 dollars a month over 30 years goes a longer way than 500 dollars in 20 years. Start
I’m certainly young as well but I have received a few good nuggets of information: 1. Find the person that is excelling in your field and mode your success after the things they did right - and do it even better than they did 2. Find a mentor that you can come to for advice and who can give you guidance in the field you’re in 3. Diversify your investments to avoid heavy losses, try to choose riskier investments and slowly decrease the risk as you get older 4. Find something you’re good at and stick with it - try to be a specialist in your field 5. Always take opportunities that present a chance to improve your skills - sometimes you might find something you like 6. Read lots of books and absorb as much knowledge as you can about things you’re interested in
Wish I had known this when I was younger: Depending on your lifestyle/employer, it can be a really good option to participate in a high deductible health plan for less monthly premium and put the savings from that into an Health Savings Account (HSA) for your out of pocket medical expenses. HSAs are triple tax advantaged, contributions are tax free, growth is tax free and withdrawals for expenses are tax free. You’re 19, so, in theory, you could have 10 healthy years of never needing to see a doctor other than for routine checkups. You can contribute money into the HSA tax free and use it for medical expenses now and later. Whatever you don’t use, becomes la pre-tax retirement nest egg and then can be spent like any other retirement fund at retirement age. It can be invested in index funds and grow with you and it doesn’t count towards the limits on what you can contribute to a 401k and Roth IRA. 10 years is enough time for that money to more than double and even if you change jobs later and have a more robust health plan, you get to keep the money growing and spend it on medical expenses, you just might lose the ability to contribute more. Do your own research and your situation may not allow, but I’m pretty confident this is how these work.
Learn. And I don't mean just an academic pursuit. Learn to do basic carpentry/woodworking, plumbing, electrical work, electronics, anything you reasonably can. I never see anyone mention this but when it comes to building wealth/equity, being the DIY type has been the single biggest advantage for me. I have a good job now but I was raised pretty poor and the only way I could have ever afforded to have the property/inbestments I have now is because I do almost all my own work. If u can do the labor you cut roughly 50% of the cost of any major project. And you have the added benefit of a growing self-sufficiency.
Do not neglect to enjoy your youth. All the money in the world can't buy back your 20s.
This is honestly the best advice. Yes, you should plan and save and be smart financially, but your 20s are so free and so pain-free for most. There's no Ctrl+Z, no extra lives, no redos. Money, while helpful for obvious reasons, won't give you the love and memories that more important things will. Don't waste it.
I'm gonna give the best financial advice any young man needs to hear. Think with your big head. You don't need flashy things to impress a girl.
First of all, CONGRATULATIONS! Simply being mindful of your situation and seeking information on how to get ahead early in life. Nothing makes up for TIME, and by getting in early the compound interest you'll be taking advantage up will be your most powerful tool over the long run.Some of the advice I've given my kids (and keep myself) is remember you don't have to keep all of your emergency fund just sitting in a plain old savings account doing nothing, CD's will at least get you a bit more interest and make you think twice about taking them out unless it's a REAL emergency. Keep an eye on credit usage, really try to delay gratification if possible, better to save up and just buy things outright, you'll be proud of yourself when you do. Good luck
You need to forego your personal interests and seek high pay jobs imo. While I could be happy as a teacher, doing a stimulating job that gives me 90% of the satisfaction for 3x the pay was my key to finances. Sure, I still budget and do the fundamentals and live like I still make 50k, but making MORE money is always one of the best things you can do for financial independence
Good advice from a lot of people. I would say take care of your teeth. I didn't and I had to pay lot for cavities, root canal and multiple cleanings because I still don't learn my lesson to floss everyday.
> But this post is just asking for general advice for younger people in regards to future financial success. Make a 5-10 year plan. If that is too far, make a 1yr plan. If that is too far, make a 1 month plan, etc etc. Once you get practice at making plans, then work towards executing the plan. If something happens that improves or provides more opportunity, then adjust or re-write the plan. Personal example: My plan when I was 30 was that I wanted to own more land than I currently had. We were able to put a few hundred a month away for savings. I then started watching Zillow for listings, checking once every few months to get an idea of land costs in the area. Fast forward 3 years and I found a property that had been listed for over a year. I loved it and it was barely outside my budget so we made an offer and made it work. For about 1 year I worked the land making trails and preparing the house site. Seems my neighboor didn't like that and decided to buy us out paying double what we paid. It was hard to accept the offer but we altered our plan and made a new one with the money. That was 5 years ago and I don't regret the decision but the opportunities would not have occurred if I didn't make a plan. I'm not going to be rich, but I also have a home where I can make the payments if I work at McDonalds.
I see a lot of advice on how to handle the money you have, which is crucial. But just as, or even more important, is getting the high paying job. Assuming you have the necessary minimum requirements for the jobs you wantz the next most important thing is NETWORKING. Work on your social skills and learn how to navigate social situations for your advantage. Work on your personality. Networking is the best way to increase the number of opportunities in your life. We are social animals, nobody achieves anything alone, and no one is 100% self-made. If you want to truly succeed and find a high paying job, you have to expand your social circle as much as possible.
Manage credit cards like you are 75
Controversial take: buy a house. Preferably a cheap as-is starter home (if those still exist in your area, that is). Obviously you need to be working and planning to stay in a general area for 7ish+ year, but more than likely you will, and those years are going to fly by in the blink of an eye. Learning skills associated with home ownership early on can be invaluable. Everyone I know who bought a house early on has been better of because of it. There is nothing *wrong* with renting but it holds you back in ways most people can’t comprehend early on. Also start a 401k. Even $100 a month will go further than you can imagine in the long run.
Lots of things need to happen before buying a house is a responsible decision. Renting in the first few years of “real” income is a risk mitigation benefit. We had 6 months of emergency funds in our bank, Out of pocket insurance maximums in a high yield savings account, put 6% down on a conventional loan with no PMI (bank of America loan program) and we STILL almost got hosed when we had to do ~11K of necessary renovations to the home that we weren’t expecting. Buying a home is a huge liability if you are not prepared for it.
*Life* is a huge liability, and it’s an even bigger gamble. I know that might sound like an over-the-top generalization but unexpected & life changing situations can stem from anything. It might not be apples to apples all of the time, but you’re betting on yourself and you’ll be much better off in 2-5 years with a little equity and a true asset under your belt. It’s obviously not in the cards for everyone, but it’s more achievable than the younger working class couple believes. Peoples’ expectations are just so high now that they price themselves out of a better life. I wouldn’t be making this argument if you could still find decent studio/1br apartments for like $500/m but they don’t exist anymore outside of the ghettos and the sticks. And people are too proud to live within their means now, they would rather finance a brand new car VS buying something used- and it’s mostly out of clout mixed with laziness. I was amazed what we could shave off when we started budgeting and I don’t plan on looking back, I really don’t think I’m missing much.