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Old 05-22-2012, 04:13 PM
 
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Quote:
Originally Posted by 1brokegirl View Post
I would tell them to stay in school - despite the recession, college grads still rake in on average, significantly more than non-grads.
I would tell them NEVER be without health insurance. If you got sick, it could bankrupt you. I never expected cancer at age 44.
Buy a home while you are young and do a 15-yr mortgage if possible.
If your company offers a matching 401K, grab it like a thief in the night.

If you go to school, learn something useful. Not something like English literature or prehistorical art stuff. Stick to Engineering, Finance, Accounting, Nursing, Medical, Law etc.

Don't buy a house or apartment until you have enough money to pay it in full. Be aware of the cost living in a house. It can be very expensive.

Taking on mortgage is a sin.
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Old 05-22-2012, 04:52 PM
 
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Quote:
Originally Posted by lifeexplorer View Post
If you go to school, learn something useful. Not something like English literature or prehistorical art stuff. Stick to Engineering, Finance, Accounting, Nursing, Medical, Law etc.

Don't buy a house or apartment until you have enough money to pay it in full. Be aware of the cost living in a house. It can be very expensive.

Taking on mortgage is a sin.
I agree - a college degree in English probably won't yield you much more income than an experienced admin assistant would make. Stick to the tech degrees.
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Old 05-22-2012, 05:57 PM
 
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Originally Posted by abrokegal View Post
Hi all,

I've been lurking around here for a while and finally created an account.


I'm really curious about what you would tell young people (18-25 yrs old) about money, saving, being frugal, retirement planning, budgeting, etc. What are things you wish you'd started sooner? What would you recommend to a young person about money?


I'm in this age range (22) and will be graduating soon, so advice is helpful. I have a part-time job that should soon be full-time with benefits and health care coverage. I find out for sure on Wednesday. My immediate goals are to save a $1000 emergency fund ($300/1000 so far) and a 3-month fund. I budget very strictly and have managed to cut back about $300 in monthly expenses. No college loans or other debt. Not too sure what financial goals I should focus on after these 2 goals. Maybe retirement saving? Where do I go after these immediate goals?

Thanks!
Some of these things may be obvious, but as they say, common sense isn't very common:

--Don't have kids out of wedlock.
--Discuss finances BEFORE you even consider marrying someone. Marry a frugal spouse (and don't ever think that being "in love" is enough. It isn't; although it's a good staring point).
--Avoid divorce like the plague (by marrying the right person as well as being the right person). Divorce kills most people's finances.
--Your immediate goals seem on target.

--Start saving in your 401K plan at work immediately if offered. Ideally, 15% of your salary or even more. But you do need to make sure you put money in plain old savings accounts, too. Once you get a year's worth of savings, you can ratchet up the retirement savings.

-If you don't have a 401K at work, set up an IRA with a mutual fund company like Vanguard, T. Rowe Price, or Fidelity. (These are not the only good options, but there's no need to make it overly complicated).

--Invest your 401K money in a fund that invests in a mix of stocks and bonds. These funds go by different names such as "balanced", "hybrid", "target retirement date". People tend to get good results because they stick with them. Funds that only invest in bonds or that pay a fixed rate of interest won't give you the growth potential you need. Funds that invest only in stocks tend to be too volatile, which leads people to buy and sell them at the worst possible times (e.g. buy high and sell low, the opposite of what you're supposed to do).

Examples of good balanced funds:

Vanguard Wellington
T. Rowe Price Capital Appreciation
Fidelity Balanced

Book recommendations:

Is He Mr. Right? (because picking the right spouse and being the right spouse have a huge impact on your financial life). I wish this book had been around when I was 22. It would have saved me a lot of time and heartache!

Amazon.com: Is He Mr. Right?: Everything You Need to Know Before You Commit: Mira Kirshenbaum: Books

The Difference by Jean Chatzky. This book explains the differences in attitudes, traits, and behaviors of the the well off and the rest of us. She researched 5000 households and separated them into 4 categories: The rich. The financially comfortable. Payday to Payday. Further in debtors.

Chatzky then goes on to describe the difference between the people in the first two categories and the last two categories (which unfortunately is the majority of people). She also gives a lot of advice on how to move up the ladder, psychologically, emotionally, socially, as well as practical actions.

Amazon.com: The Difference: How Anyone Can Prosper in Even The Toughest Times (9780307407146): Jean Chatzky: Books

If you are interested in getting married, read any book by John Gottman on how to get married and stay married.
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Old 05-22-2012, 06:15 PM
 
13,340 posts, read 10,601,887 times
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Originally Posted by syracusa View Post
NOT getting married is hardly a smart move towards a frugal, financially secure life. Everything is easier and more economical in two.

You can say make sure you get married to the right person. Unfortunately, there are fewer and fewer prospective partners available with rock solid, old fashioned values that made marriage a great deal in life in the first place.

I can see how it would make more financial sense for a man to skip marriage ...but lack of marriage costs men a lot of other things besides money.
Agreed on all points but the last. The research shows that married men tend to earn more than single men and that this is true at every level of education. The research shows that married men tend to live longer and are happier than are single men. (True for women, too, but to a lesser extent than for men).

The wealthiest housholds in the US tend to be married couple households. The hard part is getting married & staying married.

But I do agree there seems to have been a major breakdown in trust in our society that makes getting married and saying married much harder these days than it used to be (or maybe I'm just romanticizing the past??).
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Old 05-22-2012, 06:38 PM
 
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[SIZE=4]Always spend a penny
as if you were spending a
dollar
and always spend a dollar
as if you were spending
a wounded eagle and always
spend a wounded eagle as if
you were spending the very
sky itself
From the late Richard Brautigan
[/SIZE]
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Old 05-22-2012, 06:57 PM
 
13,340 posts, read 10,601,887 times
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90% of the stuff mentioned here is great advice. The one thing no one has mentioned so far that is becoming increasingly crucial is EAT REAL FOOD. Skip the soda (diet & regular) and processed foods of every kind. Buy the whole grain pasta, brown rice, whole grain bread, fruits, veggies, and keep meat, poultry and dairy to a minimum. I don't need to tell you not to smoke, do I? Same goes with alcohol...either not at all or no more than 1 drink per day for women, 2 for men.

Eating a healthy diet will have a huge impact on your ability to work and your future health care costs. I am convinced if everyone ate the diet mentioned above that our health care costs would drop by 50%.

I am working on overcoming my soda addiction myself, a habit I started in college, uggh!

Last edited by mysticaltyger; 05-22-2012 at 07:35 PM..
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Old 05-23-2012, 01:18 AM
 
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My Dad was frugal his whole life he died at 91 with a very nice savings, he always taught us to live below your means, the best advice ever....
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Old 05-23-2012, 06:49 AM
 
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Educate yourself so that you can get the best job you can. You can be the most frugal person in the world, but if you are only making $10.00 an hour, it's going to be a lifelong struggle.
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Old 05-23-2012, 07:08 AM
 
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Originally Posted by mysticaltyger View Post
Agreed on all points but the last. The research shows that married men tend to earn more than single men and that this is true at every level of education. The research shows that married men tend to live longer and are happier than are single men. (True for women, too, but to a lesser extent than for men).

The wealthiest housholds in the US tend to be married couple households. The hard part is getting married & staying married.

But I do agree there seems to have been a major breakdown in trust in our society that makes getting married and saying married much harder these days than it used to be (or maybe I'm just romanticizing the past??).
Marriage is on its way out. Getting married statistically would send you to divorce, misery and wounded. It is definitely NOT a ticket to wealth.

Even the statistics show married men earn more, it does NOT mean you should get married.

Marrying the right person would help you both financially and personally; however the "right" person is a needle in a haystack, more or less, like buying lottery. Except, when you buy lottery, you only lose a few dollars while getting married, you would lose years of your precious life and half of your wealth.

Weigh that very carefully.
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Old 05-23-2012, 02:12 PM
 
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My advice as someone who just turned 30 today.

You have control over how much comes in and how much comes out. You can get ahead by just controlling how much comes out (i.e. savings) and by living frugal... but you can get further ahead by being able to control how much comes in (income).

The wealthiest people are not those who work and get paid a decent amount of money, the wealthiest people are those who think outside the box and create rather than live the rat race.

Yes, you can live frugally and be ok. But why settle for mediocrity?

Use your mind and think outside the box.
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