The Money Mustache Community
General Discussion => Welcome and General Discussion => Topic started by: luke15 on March 18, 2013, 09:13:32 PM
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Hi all,
Only recently discovered the blog in the last few weeks and have been thoroughly enjoying the posts that Ive read.
My question is as a pretty young person, who fully understands that there are much much wiser people on the forum than me, what are the things that you wish you knew when you were first starting the 'stache building?
I guess also no harm in introducing myself a bit as well... I'm currently a full time student at uni, in the lovely country of Australia, and though getting the chance to work a casual job for a few hours a week, am in no position to put away half of my very low income in savings, mostly due to the rent having to be paid and groceries to be bought etc.
However trying my best to make the little things count, riding my bike to class and work, dipping my toes in the investment waters, and shopping as efficiently as possible.
Anyways would love to hear some words of wisdom!
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When you finish school, don't reward yourself with 'adult' things like most will, such as an 'adult car' or an 'adult apartment'. Keep your standard of living very similar to now, and save the rest of your, hopefully increased, salary.
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GFC was just around the corner so I wish I knew about risk management. Now I do, and I'm glad I lost a shitload and learned the lesson when I was 21 instead of 41.
And I wish I knew that old quote "the market can stay irrational longer than you can stay solvent". I was so dumb...our sharemarket fell further than any other, and we didn't even have a recession!
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Don't lose $2k because your friend told you about this awesome "investment" opportunity online, that suspiciously looks like a pyramid scam, but you're young and think you can get your money plus "interest" out in time before it crashes.
Me at 21, a long time ago.
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A huge chunk of your future happiness (or not) will be strongly influenced by the person you choose to partner with.
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Taking care of your body isn't just good for you, it's a financial investment. As you are thinking about your financial future, think about your physical future and be realistic. For example, if you are fair haired with light colored eyes, watch the sun exposure. Wear a hat and sun glasses when riding your bike. And for you other small boned women out there: be aware that bike riding does not build the bones you need in the future...be sure to also do exercise that involves more weight bearing.
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You can file your taxes late if they owe you a refund, but don't.
If you then forget about it and three years pass, you lose your refund.
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[assuming you come from a typical middle-class family,] You cannot afford to live like your parents do.
Save money. NOW. It doesn't matter how little you make; if you aren't saving money, you aren't living below your means.
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You are going to have to pay back those student loans that you're spending on eating out, going to awesome parties in San Francisco and custom made leather jacket. (all true... sigh)
YOU ARE GOING TO HAVE TO PAY BACK THOSE LOANS.
Haha. Honestly I didn't have a clear direction in university either and probably should have started working / world travel soon, but definitely was caught in the 'gotta have a BA' trap, even though the BA I was getting wasn't the one I needed for the work in children's rights that I was pursuing.
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When you finish school, don't reward yourself with 'adult' things like most will, such as an 'adult car' or an 'adult apartment'. Keep your standard of living very similar to now, and save the rest of your, hopefully increased, salary.
This in my opinion is GREAT advice. You will see your peers buying cars that cost 100% of their annual gross salary, etc and 5-6 years down the road they've spent a significant portion of their income on vehicles or they've even increased their spending as their incomes have increased. It's much harder going from a 2011 mercedes benz C350 sport to a 1999 Honda Civic Cx than the other way around.
It's all about conditioning yourself to stay frugal, just because you got a job right out of university doesn't mean you have to go on a 10k Europe trip or buy a 40k car because you "deserve it".
Don't kid yourself, it's paid off in spades for me.
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Make sure you take the time to do stuff you've always wanted to do rather than just keep your nose to the grindstone. You can make more money, but you can't make more time.
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The math of FI / ER / being Independently wealthy that MMM and Jacob of ERE laid out in a perfectly clear manner.
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A life in balance is a life indeed - Seek out and savor the meaningful stuff in life (friends, family, enjoyment, - NOT consumerism/materialism/workism) as you only get one life and without these things it is no life.
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Not a single thing you can buy will make you as happy as creating financial stability you'll have after a little sacrifice. Be thoughtful rather than automatic about how you choose to grow in the world outside of college.
When you make mistakes with your money, remember you started young. You have plenty of time to learn and make changes. Be gentle with yourself when you reflect. Work hard to keep your heart open when hard times will make you want to shut down and give up.
You won't see that it's best for a while. It's hard to watch your friends out having fun when you've got to go home and eat your lentils. Be the ant and don't be swayed by the grasshoppers. When you're in your 30's You'll be grateful to your younger self.
Chose to surround yourself with other ants. ;o)
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This isn't penny-pinching advice, but this site is about optimism and choosing the right tradeoffs between money and free time rather than simply cutting budgets to the bone due to fear of the future.
So long as you're pursuing a reasonably lucrative degree that'll enable you to pay off your student loans, take as much advantage of the week- and month-long breaks during college as you possibly can! Instead of putting every penny you earn into tuition, spend some of your earnings on cheap plane/train/bus tickets and hostels or a touring bike and panniers and take as many freewheeling adventures as you will. Most entry-level professional jobs (at least in the US, looks like you get 4 weeks as as Aussie) only offer two or three weeks of vacation starting out, so you won't have big chunks of freetime again until you're between jobs, retired or unless you are a good enough employee to negotiate unpaid time off with your boss after a year or more. If you're changing jobs involuntarily, you probably won't be in the mood to travel either. Nor are you likely to be as free from responsibility as you are at twenty for quite some time.
At least for me, taking time from my winter breaks to travel rather than sitting around at my parents' house would definitely have been worth a couple thousand extra dollars in student borrowing to me-- it would have maybe prolong my working career a few weeks, but in exchange for some awesome memories. When you're young and traveling alone, a couple thousand dollars can go a very long way.
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Things will happen in the future, including those you enthusiastically embrace and bring into your life (a husband with teenage kids and no savings) that you could not reasonably have anticipated or planned for. Having some resources set aside, or not being in a hole to start out with, will make this easier.
Your body (including your brain) has to last you for the rest of your life. Treat it well.
(Female) fertility declines more rapidly than you might think. Don't put off trying to have children if/once you are ready.
This one I got, but it still bears mentioning: it is so much easier and cheaper to travel when you are young, relatively unfettered by dependents (be they human, animal, or logistical), and relatively tough/carefree.
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If it is feasible - take advantage of study abroad programs during college. At my school it was the same cost as tuition. In retrospect I wish I had utilized that time to go more places.
I will second the female fertility decline - it is a pain in the ass - I wish I had knew more about what at pain it could be earlier.
Try to find job opportunities that are high earning and that you enjoy and may offer you flexibility at some point - potentially not early on. Computer programming/engineering can be a good option.
I job hopped and it really helped me out in terms of income.
Marry a nice person. Best decision I made.
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I second all the statements about physical health being a lifelong investment with infinite reward (and no downside risk). While staying fit is obvious, the means to get fit is debatable. For what it's worth, my preferred route is to lifelong fitness is strength training. I wish I'd learned about basic barbell training when I was 20. Check out Barbell Training is Big Medicine (http://startingstrength.com/index.php/site/barbell_training_is_big_medicine).
On the financial front, I never did anything terribly stupid with money, but I was sub-optimal. Since finding MMM, I've done a lot of reading on personal finance and investing. When I was fresh out of college, everyone said, the earlier you start saving the earlier you can retire. I believed it: I was putting 12% of my pay into 401k. In hindsight, I could have done better (but I also could have done a lot worse). For example, if I knew then what I know now, I would have first done enough 401k to maximize employer match, then maxed out my RothIRA, then gone back and added as much as I could tolerate to my 401k.
In general, when I was 20, I had a rough, very shallow fundamental knowledge of these personal finance and investing topics. But in the last year or so, I've made it my new "hobby" and I know so much more (and I'm still learning). I wish I had my current knowledge back then. The biggest eye-opener for me has to do with how it ultimately enables retirement (or not!). The whole notion of "passive income" is fascinating to me. Safe withdrawal rates, tax efficiency, real rate of return, inflation, mortgages as an "investment", interest rate considerations, bonds, index funds... good stuff to know!
When I was 20, I wish I'd learned and understood the concept of hedonistic adaptation.
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I wish I knew what to do with all of the money I was earning and socking away. At 22 I had worked for a year at $6.xx an hour, and had saved up $10K. (No, that is not a typo, I was world class cheap back then). Then I quit my job and spent all the money in another year. I had NO idea what to DO with the money! Investing, emergency funds, saving up for a car, ANY of those would have been a good plan!
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College is a place to learn. If you've spent a year or two partying, either get down to business or bow out for a couple years until you can be serious.
Go for undergrad research opportunities.
Don't get addicted to things. Protip: if you ever think, "Man, I really need a beer," you are addicted. I learned this from Richard Feynman's book, and it is so true.
Learn how to play sports even if you never did so as a youngster. High-endurance pick-up games are best, like soccer, basketball, ultimate frisbee. Things that don't require much organization. If you are in the US, and you like soccer, you will connect with immigrant communities if they are nearby. (Literally any immigrant community.)
Speak another language fluently and regularly. In the US, Spanish is the easiest one for finding native speakers.
If you play an instrument, keep playing it.
You don't have to throw money around to attract the opposite sex. In fact, most people don't like being "purchased". You don't have to give gifts to people to make them like you. This doesn't mean you shouldn't be generous. Everything in moderation.
If you can't afford to buy a million songs, don't do it. Hang out with your friends and make music a social experience. Better yet, make your own.
If you can't afford to buy a million books, use the library.
If everyone else is doing it, there is probably advertising that is behind it. A good example is pricey diamond engagement rings. Turn off the TV.
It is much easier to find a mate when you're not actively searching.
Hmm, that's probably enough for now.
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Stay away from redheads and motorcycles.
Man, now that I say it out loud it sounds stupidly simple, but not following that advice caused more harm to my life than anything else in my 36 years.
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If everyone else is doing it, there is probably advertising that is behind it. A good example is pricey diamond engagement rings. Turn off the TV.
this is a really good way to look at things.
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I wish I had known:
-that college scholarships can disappear if you get married
-that moving to the country for fresh air, peace, and no crime means you will have to own 1-2 cars at all times. You can't walk or bike or you can literally die from attempting biking
-don't increase your lifestyle with each pay increase. Try that newly wed poor forever. No matter what the anyone tells you, you don't have to upgrade your house, cars, or life.
-don't care about the Joneses! The most perfect polished designer Jonese can end up with DUI's, multiple divorces, and bankruptcy anyway. So why let them judge you for having a tiny house and old paid for cars?!
-that even great, well behaved, hard working, employed, FRUGAL teens are expensive (despite was Amy D said in the TWG book or anyone else tells you). Also about the time they need some funding to transition into adulthood your tax break ends (age 17).
-don't be afraid to live counter culture with your financial life
-that all the people who thought you were weird for being frugal in the 80's 90's and 200's will eventually learn in the 2010's that frugal is not such a bad things after all! But also know when the economy improves the newly frugal will possibly not stay frugal. It was a temporary lifestyle change.
-buy that property now, the prices will explode later and will be out of your reach
-to copy that very young girl at work who put a ton of her paycheck into "retirement" even though "retirement" wasn't on my radar.
(ok I was 19..... but still)
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Things I wish I had known:
- Dating is probably not as important as you think it is, no matter what everyone keeps telling you. College is better spent studying and making platonic friends. If your "soulmate" sucks away your money, time and sanity instead of boosting you up, they're probably not your soulmate.
- Befriend everyone: professors, roommates, study group members, etc. Cheap socializing and better career outcomes guaranteed.
- Student loans aren't free money. Don't go for the max just because you can.
- Having a student job isn't shameful. It's probably a good idea.
- Travel when you can (road trips with friends, study abroad, whatever). It's way harder to get 3 weeks off when you leave school.
- Learning a language is easier when you're in school.
- Finally, it's not that big a deal when something bad happens, even though it seems like the end of the world. You have plenty of time to pick yourself up and start over again.
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More than anything: the power of compounding over time. A few bucks a month squirreled away and never every touched from age 20 can make you wealthier than you actually think you have the power to be. Corollary: A few expenses avoided (and not even that many) can make you rich.
I keep trying to figure out how to impart this on my younger nieces (without sounding all old-fart preachy). I see them gradually climbing the ladder of income and at the same time climbing the ladder of expenses. I would love to see them live at more than net-zero.
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Stay away from redheads and motorcycles.
Red hair, and black leather, my favorite color scheme! (credit to Richard Thompson, and really more descriptive of my husband than myself, but too good to pass up!)
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Without going into too much detail.
Never attempt to hurdle a fixed object!
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sheesh. the things I wish I knew at twenty...I could go on for hours. I knew hardly anything at twenty.
I guess, to know that things change. Nothing stays the same. there are ups and downs and sometimes the lows last too long and the ups dont last long enough, but sometimes its the opposite, too. be flexible, tolerant, patient and thoughtful. do things as well as you can. be present. enjoy your friends and your family and your life.
I really really wish I had learned and known how to live within my means and to save.
I wish I had traveled more. (like another poster said, before kids and pets!)
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I wish I had known about behavioral investing and investor psychology before I started investing at 18 years old just when the tech bubble was at its highest. Had I known what I know now, I'd be loaded already at 31. Now I've still got about 10 years to go to reach the coveted FI.
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That I'd pretty damn badass by the time I'm 30.
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You are only allowed to compare yourself today to the person you were yesterday. Your spouse? You get a beating for that. The neighbors? Beating for that. Your best friend Steve? Beating for that. If you must compare you to someone, you compare you of today to who you of yesterday, then prove him wrong when he said he was the best he was gonna get. Fuck that guy, prove him wrong and be better. You do you, let everyone else do everyone else; that's their choice.
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Happiness does not come from things that are external to yourself. You need to figure out what "enough" means in order to find joy and live well.
When I was 20 (five years ago), I was constantly trying to do more. I worked two jobs and took six courses a semester, which became easy, so then I wrote a letter to the dean to let myself do eight courses a semester, and got a job with UNICEF so that I had three jobs at the same time. I slept on Sundays. Then that wasn't enough, so I decided to write a thesis... and on and on. I was only ever "impressive" to myself for brief periods of time, and then I'd quickly feel like I wasn't doing enough again.
This feeling of illegitimacy, of emptiness, pervaded every aspect of my being. I was constantly looking for authenticity and challenge. Traveling to a resort wasn't authentic in any way, so instead I would fly to a country with just a brief primer on the language and no plans and hitchhike and beg my way around, to try to find that authentic experience. Of course, that didn't last either. No country was ever poor enough, or dangerous enough, or obscure enough, and I was back on the treadmill again.
The problem was that these experiences depended on other people and things that were external to me. The only times that I did find happiness were when I'd trapped myself in environments of solitude, hundreds of kilometers away from cell phones where the only thing to do was to reflect and feel connected to nature. The key, and I've only realized this in the past few months, was to stop giving other things and people power over my joy.
So, if I could give 20-year-old me a piece of advice, it would be just that. Take joy in the things that you control by being honest and realistic, analyze all things to figure out what things you can't control (don't place value on those things), and for things that you have some control over (your mark on a paper, or your deadlift weight, or the treatment of the animals that you eat), figure out what parts of that thing you control, be honest and focus on those parts, and don't sweat the rest.
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A lot of good stuff has been written here. But one eye-opener for me was this video (http://www.ted.com/talks/susan_cain_the_power_of_introverts.html) (19min long). It made way too many things "click" and made me look at people completely differently than I did before. I highly recommend it.
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Trust my gut that the people I was hanging out with were generally going to be go nowhere losers.
I eventually acted on this, but took two more years until I was 22 before I moved on. Still talk to some of these people once a year or so. They've grown up a bit. But still not really doing much for themselves.
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A huge chunk of your future happiness (or not) will be strongly influenced by the person you choose to partner with.
This, exactly. No one will impact your life probably more than the person you choose as your partner. Make it count.
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Great thread! :)
Mine are:
- trust your instincts
- don't do something just because everyone else is doing it
- be careful going into business with friends
- don't be afraid to ask for the things that you want
- enjoy all the little moments
- your health is everything - make it a huge part of your life
- money brings freedom if you let it, but nothing more
- keep the friends you really click with - they are hard to find
- surround yourself with positive people
- kids will teach you so much about life, but they are also a lot of work - be ready
- it's okay (and wonderful, even!) to have just one kid
- spend time with family, especially your parents - the moments become few and far between as you get older
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I am 23 now and this thread is quickly turning into one of my favorites. My one small piece of advise right now would be: get a degree in a SKILL (I.e., programming, accounting, engineering, etc). It may mean taking harder courses, but you will get paid better and have more options to work on your own terms. I am fortunate to have a well paying job with a very general degree, but many of my peers weren't so blessed. Given the choice again, I would major in computer science.
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I am 23 now and this thread is quickly turning into one of my favorites. My one small piece of advise right now would be: get a degree in a SKILL (I.e., programming, accounting, engineering, etc). It may mean taking harder courses, but you will get paid better and have more options to work on your own terms. I am fortunate to have a well paying job with a very general degree, but many of my peers weren't so blessed. Given the choice again, I would major in computer science.
I don't know, my International Development/Sociology/Philosophy 150 credit-hour creative basket weaving degree taught me so much about life and the world that I wouldn't trade it for all of the golden egg laying certifications in the world.
Excuse me while I go back to school at 25 to get a Bachelor of Education. >.>
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I'm 21, so the one thing I wish I knew when I was 20: You're going to take your pants off at your 21st, so please wear really nice underwear.
All jokes aside, I love this thread :)
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I think the key essence here is no matter what your age look at your life RIGHT NOW and evaluate it as looking back 20 years from now and think what should I have done differently then.
You can learn from the past, so applying it now is the implementation of that learning.
It's bad enough we made mistakes when we were young but even worse it we make them again as we are older. That is the one thing that age does allow us...wisdom.
George Bernard Shaw said that "Youth is wasted on the young" .....but at least we have that behind us.
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I'm 21, so the one thing I wish I knew when I was 20: You're going to take your pants off at your 21st, so please wear really nice underwear.
All jokes aside, I love this thread :)
Lucky you! :D
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I am 23 now and this thread is quickly turning into one of my favorites. My one small piece of advise right now would be: get a degree in a SKILL (I.e., programming, accounting, engineering, etc). It may mean taking harder courses, but you will get paid better and have more options to work on your own terms. I am fortunate to have a well paying job with a very general degree, but many of my peers weren't so blessed. Given the choice again, I would major in computer science.
I don't know, my International Development/Sociology/Philosophy 150 credit-hour creative basket weaving degree taught me so much about life and the world that I wouldn't trade it for all of the golden egg laying certifications in the world.
Excuse me while I go back to school at 25 to get a Bachelor of Education. >.>
I got a BS in Electrical and Computer Engineering, and used every other credit hour to take tons of other courses in history and environmental studies and Spanish and all that, and that was a great balance for me. I learned a ton of interesting things, some about computers and some not, and have had an excellent career since.
My girlfriend got a major in philosophy and a minor in CS, and has likewise had excellent luck in the job market-- most upper-level academic CS isn't particularly necessary for a lot of programming jobs.
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I got a BS in Electrical and Computer Engineering, and used every other credit hour to take tons of other courses in history and environmental studies and Spanish and all that, and that was a great balance for me. I learned a ton of interesting things, some about computers and some not, and have had an excellent career since.
My girlfriend got a major in philosophy and a minor in CS, and has likewise had excellent luck in the job market-- most upper-level academic CS isn't particularly necessary for a lot of programming jobs.
I've gotta give a +1 to this!
I have a B.S. in Mechanical Engineering with a minor in Psychology, also took several extra Computer Science courses and I've always had a interest in History (books, documentaries, etc.). Since school I've been studying Spanish (also as part of my engineering job with an Argentina based company).
I definitely agree with the balance between technical and non-technical areas of interest.
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I wish I had read these books when I was 20 (in order)
Your Money or Your Life by Joe Dominguez, Vicki Robin
The Millionaire Next Door by Thomas J. Stanley, William Danko
A Random Walk Down Wall Street by Burton G. Malkiel
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I am 23 now and this thread is quickly turning into one of my favorites. My one small piece of advise right now would be: get a degree in a SKILL (I.e., programming, accounting, engineering, etc). It may mean taking harder courses, but you will get paid better and have more options to work on your own terms. I am fortunate to have a well paying job with a very general degree, but many of my peers weren't so blessed. Given the choice again, I would major in computer science.
I don't know, my International Development/Sociology/Philosophy 150 credit-hour creative basket weaving degree taught me so much about life and the world that I wouldn't trade it for all of the golden egg laying certifications in the world.
Excuse me while I go back to school at 25 to get a Bachelor of Education. >.>
I got a BS in Electrical and Computer Engineering, and used every other credit hour to take tons of other courses in history and environmental studies and Spanish and all that, and that was a great balance for me. I learned a ton of interesting things, some about computers and some not, and have had an excellent career since.
My girlfriend got a major in philosophy and a minor in CS, and has likewise had excellent luck in the job market-- most upper-level academic CS isn't particularly necessary for a lot of programming jobs.
Yeah I think the liberal arts unemployment problem has one caveat: if you never move or leave your comfort zone. So, for me, the key was to move away from my comfort zone of my hometown and get a job elsewhere in my country. If that didn't work I would simply leave the country for an area where I was in higher demand, like the Middle East or Latin America. My friends who did identical degrees are broke and underemployed because they refused to move for whatever reason.
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I wish I had read these books when I was 20 (in order)
Your Money or Your Life by Joe Dominguez, Vicki Robin
The Millionaire Next Door by Thomas J. Stanley, William Danko
A Random Walk Down Wall Street by Burton G. Malkiel
I think YMOYL might have appealed to me as a 20 year old but the Millionaire Next Door would have probably made me angry and not helped. We're still growing up at that age.
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I'm actually 21, almost 22. I would just like to thank everyone in this thread for their wonderful advice. I can't remember how exactly I got to be so financially aware this early, but I've always known I didn't want to be a wage slave until I was 65. I think reddit opened up this awareness with r/personalfinance, which led me in turn to 'Your money or your life', ERE, and MMM.
Is there anything you could advise me on investment wise? Here's my situation:
- I live in Sydney, Australia and as such student loans are not an issue (they only rise with inflation). I currently have $28000 in loans and 1-2 years left on a bachelor of Mechanical engineering degree.
- I live at home, and I plan to until I find a wife to live with (hopefully around 28). So my living costs are effectively zero until I do. My parents are well off that they need no contribution from me.
- My starting salary in 2 years will be around 60k if I find a job in my field straight away. I plan to save as much as I can for the down payment on a home loan. I'll keep the money in term deposits (current 4.7% PA) till I use it. I would like a 3 bedroom around 400k. Interest rates are fairly high(approx 6.5%) compared to the U.S right now so I want to hammer away the loan in about 4 years if I can
- I then plan to save at the same rate till I have enough that I can live off a 3% SWR.
- I have 12k currently split evenly between savings account at 3.5%PA and a first home saver account (gov contribution of 17%PA, of a capped 6k per year. Money can only be withdrawn to buy a first home, or rolled into a superannuation fund).
That's about it I think. I'm so conflicted with advice on the markets right now. The contrarian saying buy and hold is the wrong strategy now? All I know right now is that index funds would be the safest option, but how will that provide regular income, come retirement time?
You guys are such an inspiration to me. Hopefully I can emulate some of your success looking back at my life in twenty years time.
Regards,
A newborn mustachian.
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Living in Australia, you should check online savings accounts from RAMS and UBANK. They give the highest rate on the market right now (about 4.7%) without locking your money away like a term deposit would do. I use to also move accounts every 3-4 months depending on the welcoming rates available (e.g. ING direct and RABO direct).
Given the no risk - high savings rate ratio in Australia, I wouldn't even look into alternative risky investments until you max out your savings accounts.
You will always hear contradictory opinions about where the financial market is heading. And you should not follow any of them but try to make your own. This is how the market can stay efficient, you need 2 people having different opinions such that a transaction can happen. You will always hear people tell you that "the market always goes up on the long term". But how does it fit with your strategy? What if it crashes for a few years, how do you derive income from your devaluated investments? By how much more can you beat the current savings rate? Is it worth the risk?
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Living in Australia, you should check online savings accounts from RAMS and UBANK. They give the highest rate on the market right now (about 4.7%) without locking your money away like a term deposit would do. I use to also move accounts every 3-4 months depending on the welcoming rates available (e.g. ING direct and RABO direct).
Given the no risk - high savings rate ratio in Australia, I wouldn't even look into alternative risky investments until you max out your savings accounts.
You will always hear contradictory opinions about where the financial market is heading. And you should not follow any of them but try to make your own. This is how the market can stay efficient, you need 2 people having different opinions such that a transaction can happen. You will always hear people tell you that "the market always goes up on the long term". But how does it fit with your strategy? What if it crashes for a few years, how do you derive income from your devaluated investments? By how much more can you beat the current savings rate? Is it worth the risk?
Thank for the tip off on the savings accounts. I shall get on moving my money right away.
What is your investment strategy here? I thought for while, that approx 5% would be fine, but with inflation this is lowered to about 2 percent. My goal is have a paid off home as soon as possible and then accumulate savings as fast as possible. I plan to have 2 kids so I'm comfortable with a retirement age of about 45, certainly no later than 50. At this point I would like steady income that won't fluctuate. How do you make an income stream from capital gains? The only way I can see that working is from dividends. But even then companies can change dividends at any time changing my investment income.
Are you planning on keeping your entire retirement fund in savings accounts?
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There are so many things I could say here, though others have mentioned a lot of the things I would have told you. Others have touched on getting a degree that will lead to a steady career, and I would echo that, but also take classes that interest you, and if it's an option, get a minor in something you really enjoy. My sister is 25 and a speech language pathologist, but she minored in creative writing. Interviewers always ask her about that, and she explains that she loves to write poetry, and they have always been intrigued by that, I think it makes her seem well-rounded.
Other tips (sorry for no attribution for some of these, they are quotes I have memorized or tacked up in my office!):
-don't get married until you're 25 or older (yeah yeah yeah, exceptions abound, but in general, just don't)
-a positive attitude may not solve all of your problems, but it will annoy enough people to make it worth the effort
-always be curious and seek knowledge; don't trust 'facts' that people tell you, do your own investigation
-debt = slavery
-the more you love your decisions, the less you need others to love them
-comparison is the thief of joy
-quality sleep is important; practice good sleep hygiene
-nobody ever regrets working out/going to the gym
-the entire Done Manifesto: http://www.brepettis.com/blog/2009/3/3/the-cult-of-done-manifesto.html
Good luck!
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This is a great thread on the E-R.org forums, almost the same as this topic at hand, filled with great thoughts/advice/wisdom:
Advice you'd give your 25 year old self (http://www.early-retirement.org/forums/f28/advice-youd-give-your-25-year-old-self-60672.html)
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First of all I wish that I had listened to all the wonderful nagging advice that my parents gave me for free.
Next I wish that I had understood Time. How it speeds up and the years just disappear once you pass the age of 40.
And finally I wish that someone had told me that emergencies are like wolves - they travel and hunt in packs. The first one chases you until you are exhausted. The second one hamstrings you. The third one goes in for the kill. Any ones after that - well that is just the Universe being mean.
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A huge chunk of your future happiness (or not) will be strongly influenced by the person you choose to partner with.
+1,000
Don't get married until you know yourself quite well -- strengths, weaknesses, areas where you tend to bullshit yourself, daily habits & rhythms, value system. The marry someone with similar -- though not identical --- qualities.
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If you are living paycheck to paycheck you are already in debt, the bill that puts you in debt just hasn't shown up yet.
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I wish I'd read / understood / applied Nonviolent Communication by Marshall Rosenberg.
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A huge chunk of your future happiness (or not) will be strongly influenced by the person you choose to partner with.
+1,000
Don't get married until you know yourself quite well -- strengths, weaknesses, areas where you tend to bullshit yourself, daily habits & rhythms, value system. The marry someone with similar -- though not identical --- qualities.
I got dumped by a host of girls/women when I was in college. I stayed on good terms with all but one, it's just that we weren't the right match for one another. But the experience was good for me (though not always appreciated at the time) because I got a pretty good idea of what I truly wanted in a life partner.
Then I had the one truly brilliant idea I've ever had.
Instead of focusing on what kind of woman I wanted to spend my life with, I flipped it around. Why would a woman like that want to stay with me?
I didn't like the answer because, frankly, she wouldn't.
I realized that what I needed to do was to decide what kind of person did I want to be that would also be attractive to that kind of woman. I had to want to be that kind of person or I would end up miserable. I just needed to grow into the person that I wanted to be.
I'm pleased to say that was a plan that worked very, very well. :)
Incidentally, the four long term desireability traits in a partner are:
1) Competence at drama-free daily living,
2) Reasonableness/Fairness,
3) Adult, not an Over-aged Child,
4) Loving and sweet nature.
It doesn't matter how hot they are, if they lack those essential traits you will grow to hate living with them.
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I wish I knew how addictive and expensive playing with cars would become. I'd force my 20 year old self to find a different hobby.
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I wish I had not wasted so much time in my youth worrying. It doesn't keep the bad stuff from happening, and it makes you miserable in the meantime.
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Incidentally, the four long term desireability traits in a partner are:
1) Competence at drama-free daily living,
2) Reasonableness/Fairness,
3) Adult, not an Over-aged Child,
4) Loving and sweet nature.
It doesn't matter how hot they are, if they lack those essential traits you will grow to hate living with them.
+1000
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Living in Australia, you should check online savings accounts from RAMS and UBANK. They give the highest rate on the market right now (about 4.7%) without locking your money away like a term deposit would do. I use to also move accounts every 3-4 months depending on the welcoming rates available (e.g. ING direct and RABO direct).
Given the no risk - high savings rate ratio in Australia, I wouldn't even look into alternative risky investments until you max out your savings accounts.
You will always hear contradictory opinions about where the financial market is heading. And you should not follow any of them but try to make your own. This is how the market can stay efficient, you need 2 people having different opinions such that a transaction can happen. You will always hear people tell you that "the market always goes up on the long term". But how does it fit with your strategy? What if it crashes for a few years, how do you derive income from your devaluated investments? By how much more can you beat the current savings rate? Is it worth the risk?
Thank for the tip off on the savings accounts. I shall get on moving my money right away.
What is your investment strategy here? I thought for while, that approx 5% would be fine, but with inflation this is lowered to about 2 percent. My goal is have a paid off home as soon as possible and then accumulate savings as fast as possible. I plan to have 2 kids so I'm comfortable with a retirement age of about 45, certainly no later than 50. At this point I would like steady income that won't fluctuate. How do you make an income stream from capital gains? The only way I can see that working is from dividends. But even then companies can change dividends at any time changing my investment income.
Are you planning on keeping your entire retirement fund in savings accounts?
I do plan to have a big chunk in savings account, just because I am quite risk averse. I may not earn a lot, but I've learned through various investing experience that the best way to make money is actually not to lose any :o). So by always trying to earn more and increasing risk, there is no certainty to end up better off. We also have some rental income and I'll look further into other streams when the savings rate drops to a point where it is no more worth it. But at the moment, I'm happy with what I get for no risk.
We plan to retire in 2 years time, when we reach 35. We currently have 1 kid but hoping to get more. So regular income streams are very important to us. We won't be able to rely on capital gains or other investments that do not provide a monthly payment. Rental income could be good in Australia, the real estate market is quite strong and with negative gearing on investment properties, it may be worth a look. But I fear it may be quite late to enter the market given the prices are at record highs.
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Given the no risk - high savings rate ratio in Australia, I wouldn't even look into alternative risky investments until you max out your savings accounts.
Could you explain that abit more for newbies like me? wouldnt it be better to go for a vanguard account that will probably return more then 4.60%... i know its riskier but wont you be getting a higher return and if you're keeping it there for a long long time won't it add up? or is really just better to keep it in a savings account because there is no risk for an okay return vs high risk for maybe a good return maybe a bad one?
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...Don't get addicted to things. Protip: if you ever think, "Man, I really need a beer," you are addicted...
FT(MF)W. Why do so many people not GET that?
I have to disagree, or at least clarify. About a half dozen times a year, I'll think "Man, I really need a beer" - typically after after mowing the lawn on a hot summer day, right after I shower off all the sweat. Since my beer consumption averages around 2 beers per month, I really can't believe it is any kind of addiction.
Now, if someone is using that statement on a frequent basis - sure.
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Don't have 3 daughters who will all be teenagers simultaneously, that may cause someone to feel that they need a beer,... now and then.
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-no matter how valued you are at your job layoffs happen. Be prepared.
-change jobs every couple of years for the increase in pay.
-working with specialized tools for your job makes you very desirable to other companies $$$
-trying to impress women will just cost you money
-learn to invest in stocks when the market is in the crapper.
-surround yourself with like minded people.
-don't be completely wrapped up in work bc life passes by, same goes for building your nut (stop and smell the roses
-school maybe over but learning is not
-don't live up to others expectations bc your never get ahead
Some that were taught to me by the time I was 20
-keep you shit wrapped. Std's and child support last longer then one night.
-the most important decision you'll ever make is who you marry
-your young, do some fun crazy shit
-don't rent it own it
-don't buy shit, buy things that are built to last
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Awesome thread.
- Just because you have luck with one stock pick, doesn't mean you will with the next (I picked General Magic as my first investment. It was the voice recognition software for on star, made a killing on it... then lost it on my next pick)
- Don't buy a new car just because you can (I didn't buy it right after college, I bought it 6 months later...)
- Sometimes there are some promises you make to yourself that are silly. Recognize them and allow yourself to break them. While your word means a lot, you can always forgive and rebuild.
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that the birth control patch doesn't work if it keeps coming off in your sleep.
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Asking that question and reading MMM means you're already way ahead of the game.
So here's a few suggestions from a 58 year old (or if I could tell my 20 year old self):
Figure out what you really like to do (that is profitable). Have the courage to trust and believe in yourself that that is what you want to do. And pursue it. And put in the hours to be very good at what you do. It's something you'll have for life and can never be taken away from you.
Exceptional spouse.
No drink/drugs.
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I agree with the several-times repeated "Your choice of spouse will determine much of your happiness /unhappiness."
I also agree with "take care of your health". Don't forget that teeth are included in that comment.
Other things:
- You need God, and you need a church support group.
- Write down the top five most important things in your life. When you have to make a decision of any type, refer to your list, and measure your choices against those top five things.
- When you break up with someone, don't try to stay friends. He will always misunderstand and think there's a chance you'll get back together.
About finances, since that's the focus of this board:
- My then-new husband was 100% right to insist upon buying a house and putting every other paycheck into savings. It set the tone for our financial life.
- Something someone told us in our 20s, which seemed impossible but was true: Your first $100,000 is hard to save. After you reach that point, it starts to snowball.
- Diversify your holdings.
- Do not be house poor (or car poor).
- Do not put your money into depreciating assets.
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- You need God, and you need a church support group.
Um, no. Atheists are just fine at any age. So are non-Christians.
If you want to rephrase that as "find a like-minded community you can trust and which supports each other in times of crisis" then, yes.
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Don't necessarily look to the majority of your peers/co-workers for cues on what sort of lifestyle is right for you. You can be significantly richer or poorer than other people who earn the same wage. And appearances are often deceiving.
Climbing the ladder, chasing promotions, etc. isn't the only way to progress.
Don't tell yourself, "well I make $X now... I deserve Y".
It's OK to take advice from people on message boards, but do a reality check... would someone who knows you REALLY WELL also stand by that advice?
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Nobody of advanced age ever looks back on their life and says:
"I wish I had drank more beer."
You can also substitute any of the following in for "drank more beer": done more drugs, had more sex, played more video games, eaten more food, owned more things...
It is your relationships with friends and family (and for many, God) that truly define your lasting legacy.
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Don't invest just for the tax savings.
while tax savings are great and an added bonus/part of the economics (IRA/401k/rental property), if this is your primary purpose for an investment, it's the wrong investment
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Nobody of advanced age ever looks back on their life and says:
"I wish I had drank more beer."
You can also substitute any of the following in for "drank more beer": done more drugs, had more sex, played more video games, eaten more food, owned more things...
I know many people who say they wish they had done more of those things. Did you read any of the thread I linked earlier?
Most of the advice given in this thread is from people in their 30s (based on the demographics of the MMM readership/forum users). Most of the advice in that thread, from the E-R.org group, is based on advice from people in their 50s, who have had time for a little more perspective.
I read that thread every few months, has some good advice in it. (Including sex, drugs, and rock and roll.)
So your "nobody" would say that statement is quite inaccurate. ;)
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-Start building credit.
-Learn about investing
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I know many people who say they wish they had done more of those things. Did you read any of the thread I linked earlier?
Most of the advice given in this thread is from people in their 30s (based on the demographics of the MMM readership/forum users). Most of the advice in that thread, from the E-R.org group, is based on advice from people in their 50s, who have had time for a little more perspective.
I read that thread every few months, has some good advice in it. (Including sex, drugs, and rock and roll.)
So your "nobody" would say that statement is quite inaccurate. ;)
I meant "nobody" conversationally, not literally. But it's certainly nobody I know. I just lost my brother (45 years old) earlier this year, and I've done a lot of soul searching about this topic. I stand by the main point that ultimately our relationships define us more than any job or possession or vice ever could.
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Be less comfortable and don't do the things that come easy all the time.
As in try new experiences. Do the things you always talk yourself out of.
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I'm sorry for your loss. I have a brother that I'm very close with and the thought of losing family is one of those things that can make me feel like someone hit me in the chest with a sledgehammer.
I would argue that it is our experiences which define us. And those experiences can involve those aforementioned relationships, jobs, and the generic sort of experience (including things you've so easily labeled as vice). When looking back and saying I wish I had done more X, that X can be anything, it is a rather blanket statement to say relationships will be more important than other possible experiences to the individual looking back. What if that person had fulfilling relationships and doesn't have any regrets. Maybe would have wanted to party a bit harder. Who is to say one way or another?
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This is a great thread on the E-R.org forums, almost the same as this topic at hand, filled with great thoughts/advice/wisdom:
Advice you'd give your 25 year old self (http://www.early-retirement.org/forums/f28/advice-youd-give-your-25-year-old-self-60672.html)
I am going to make a dental appointment after reading that thread!
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I wish I had known to think of my expenses in percentages of net income instead of just $. I found a suggested "expense pie" on a great blog and it completely changed the way we planned and budgeted.
The great thing about this is that it is flexible. The percentages are maximums but you can economize and thus save in many areas. 35% for all housing costs including property taxes and utilities. 15% for transportation. 25% for life including groceries, medical, childcare. 15% for debt including consumer and student loan. 10% for savings.
The flex part comes when you have no debt - you now have 15% to put in other places like increasing you savings or to meet new life costs such as childcare. If you ride your bike or take public transport that gives you another large amount of money every month to play with. Like putting it into a vacation fund.
This simple percentage suggestion helped us to NOT buy a house that we could afford to buy but that would actually make us house poor and to buy the car that suited our needs rather than the one we coveted. It sure was pretty but what a gas guzzler.
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If there are colleges and universities where you live, try to find a house in the neighborhood where the professors live. They're generally low-paid but interesting people, and the neighborhood is probably both cheap and fun to live in.
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- You need God, and you need a church support group.
Um, no. Atheists are just fine at any age. So are non-Christians.
If you want to rephrase that as "find a like-minded community you can trust and which supports each other in times of crisis" then, yes.
I stand by my statement, but then I'm not particularly politically correct, and this is a highly secular board.
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A huge chunk of your future happiness (or not) will be strongly influenced by the person you choose to partner with.
+1,000
Don't get married until you know yourself quite well -- strengths, weaknesses, areas where you tend to bullshit yourself, daily habits & rhythms, value system. The marry someone with similar -- though not identical --- qualities.
While I agree with you, the trouble is that every 18 year old THINKS he knows himself perfectly well and is just as mature as every 30-year old. And every 18 year old he THINKS he is the person he'll be for the rest of his life!
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I wish I had known to think of my expenses in percentages of net income instead of just $. I found a suggested "expense pie" on a great blog and it completely changed the way we planned and budgeted.
The great thing about this is that it is flexible. The percentages are maximums but you can economize and thus save in many areas. 35% for all housing costs including property taxes and utilities. 15% for transportation. 25% for life including groceries, medical, childcare. 15% for debt including consumer and student loan. 10% for savings.
The flex part comes when you have no debt - you now have 15% to put in other places like increasing you savings or to meet new life costs such as childcare. If you ride your bike or take public transport that gives you another large amount of money every month to play with. Like putting it into a vacation fund.
This simple percentage suggestion helped us to NOT buy a house that we could afford to buy but that would actually make us house poor and to buy the car that suited our needs rather than the one we coveted. It sure was pretty but what a gas guzzler.
Yes, I wish I'd known that it was possible to look at finances in that way when I was younger. Today we have a house and cars that're paid for, and we don't really pay attention to our budget like we did in the past -- rather, we just live by the habits we've established, and we have an instinctive feel for what's okay /not okay when it comes to spending. BUT when I was younger and didn't yet have that instinct, viewing finances in terms of percentages would've been a very good learning tool. In fact, I've taught my daughters something similar to what you suggest -- they're young enough to need that guidance.
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Save. What's your net worth and projected net worth? 80/20 asset allocation. Vanguard.
Yet also invest in yourself. Travel a lot, to cheap places, before you have kids.
Get a real education that produces marketable skills. Be that plumber or engineer. Poetry is for trust funders I'm afraid kids.
Relationships are what life is all about. Build and preserve them.
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I don't really have anything to add, but I just felt like bumping this old thread.
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You get out of it what you put into it. People are most attracted to you when you let them see the authentic you. Keep your expenses well below your income. Invest well.
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Well, when I was 20 I had been married for two years and was probably a couple of months pregnant. But that was 37 years ago. What do I wish the 20 year old me knew then... (financially speaking)
1. Buy a house at the top of what you can afford instead of what you can easily afford. The payment will stay the same and salary will go up, so in a few years it will be easier.
2. Every time you get a raise, have that money automatically deducted to savings. It will make a big difference.
3. 1/2 a dryer sheet works just a good as a whole one. Over 37 years, even that would have added up.
4. When you buy furniture, buy quality and not trendy. You won't have to replace it in your lifetime.
5. Somehow the money you give to church doesn't hurt your budget. I can't explain it, but every since we began to tithe, the 90% seems to go further than the 100% did before.
6. Learn to cook in your 20s instead of waiting to the 30s. It is cheaper and healthier. Teach your kids to cook.
7. Save up an emergency fund and then increase all your insurance deductibles. (I could have saved a fortune by doing this a lot sooner).
8. Micro fiber cloths are fantastic. Not sure how long they were out there before I discovered them. But a lot of things clean with just water or maybe a little vinegar. Save a lot of money on cleaners.
I'm sure there are more, but that's enough for now.
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A huge chunk of your future happiness (or not) will be strongly influenced by the person you choose to partner with.
This, exactly. No one will impact your life probably more than the person you choose as your partner. Make it count.
There is a lot of "girly" advice being throw around here :-) ... Sure glad I punched few "weight classes" above my own and found a pretty one to boot! I may never chose "smarter than me" again though- just way to much accountability...and they pass it along to "your children" and you may find yourself soon outnumbered by "smart and pretties"!
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1. Buy a house at the top of what you can afford instead of what you can easily afford. The payment will stay the same and salary will go up, so in a few years it will be easier.
I have to disagree with this... IF your salary goes up, it becomes easier, yes. But if you become ill or disabled, have a loved one who requires care, have children and decide you'd like to see them occasionally rather than work long hours to pay off the damn house, or get made redundant... yeah. You've just set yourself up for heartache.
I've seen too many people buy the most expensive house they can afford, and then end up penniless a few years down the track when they can't afford it anymore. Or worse - someone I work with has a mother with alzheimers and would love to drop down to part time to spend more time with her, but can't afford it because her mortgage is too high.
I'm sure this has worked out okay for you frugalconfederate or you wouldn't consider it good advice, but everyone I know IRL who tells me to buy the most expensive house I can afford is either currently in the process of declaring bankruptcy, or has already had to declare bankruptcy and is now struggling on welfare, or is forced to work much more than they would like just to make their payments. Whereas the ones who tell me to buy the least expensive house I can that will still meet my needs, are the ones who are able to retire at 50.
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A huge chunk of your future happiness (or not) will be strongly influenced by the person you choose to partner with.
This, exactly. No one will impact your life probably more than the person you choose as your partner. Make it count.
I agree! I was doing pretty good on my own but once I found her every changed for the better.
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I'm glad this got bumped, I really like it!
The best thing that I ever did was to take 6 months off of work when I was 23 and again when I was 26 to travel around, hang out, and discover myself. This gives you the freedom to explore things like nothing else. I lived frugally before and after, but during those times I burned through my savings (still living frugally) driving around north america and seeing all I could see, staying in hostels and campsites and cheap hotels.
My real learning started after university. If you don't want to stay in university, don't. You can go back later if you don't like it.
Don't be afraid to go talk to strangers, they are just friends that you haven't met yet.
I don't regret all the beer that I drank.
Just because you've put a lot of time and effort into something, if it's not working out, move on. You'll never get it back. That goes for relationships too. It takes guts.
Be honest with yourself always.
Don't be afraid to try.
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1. Buy a house at the top of what you can afford instead of what you can easily afford. The payment will stay the same and salary will go up, so in a few years it will be easier.
I have to disagree with this... IF your salary goes up, it becomes easier, yes. But if you become ill or disabled, have a loved one who requires care, have children and decide you'd like to see them occasionally rather than work long hours to pay off the damn house, or get made redundant... yeah. You've just set yourself up for heartache.
I've seen too many people buy the most expensive house they can afford, and then end up penniless a few years down the track when they can't afford it anymore. Or worse - someone I work with has a mother with alzheimers and would love to drop down to part time to spend more time with her, but can't afford it because her mortgage is too high.
I'm sure this has worked out okay for you frugalconfederate or you wouldn't consider it good advice, but everyone I know IRL who tells me to buy the most expensive house I can afford is either currently in the process of declaring bankruptcy, or has already had to declare bankruptcy and is now struggling on welfare, or is forced to work much more than they would like just to make their payments. Whereas the ones who tell me to buy the least expensive house I can that will still meet my needs, are the ones who are able to retire at 50.
I think that all too often people buy a house they can't afford instead of the top end of their affordability range. Of course, it wouldn't work for everyone, but it would have been great for me. We actually still live in the same house that we bought when I was 18, and I am 57 now. Its not that I am unhappy with my home, but when the kids were home it would sure have been nice to have two bathrooms. And now the neighborhood has gone to a lot of rentals. Of course we could move, but at this stage in my life that just sounds like too much trouble.
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1. Buy a house at the top of what you can afford instead of what you can easily afford. The payment will stay the same and salary will go up, so in a few years it will be easier.
I have to disagree with this... IF your salary goes up, it becomes easier, yes. But if you become ill or disabled, have a loved one who requires care, have children and decide you'd like to see them occasionally rather than work long hours to pay off the damn house, or get made redundant... yeah. You've just set yourself up for heartache.
I've seen too many people buy the most expensive house they can afford, and then end up penniless a few years down the track when they can't afford it anymore. Or worse - someone I work with has a mother with alzheimers and would love to drop down to part time to spend more time with her, but can't afford it because her mortgage is too high.
I'm sure this has worked out okay for you frugalconfederate or you wouldn't consider it good advice, but everyone I know IRL who tells me to buy the most expensive house I can afford is either currently in the process of declaring bankruptcy, or has already had to declare bankruptcy and is now struggling on welfare, or is forced to work much more than they would like just to make their payments. Whereas the ones who tell me to buy the least expensive house I can that will still meet my needs, are the ones who are able to retire at 50.
I think that all too often people buy a house they can't afford instead of the top end of their affordability range. Of course, it wouldn't work for everyone, but it would have been great for me. We actually still live in the same house that we bought when I was 18, and I am 57 now. Its not that I am unhappy with my home, but when the kids were home it would sure have been nice to have two bathrooms. And now the neighborhood has gone to a lot of rentals. Of course we could move, but at this stage in my life that just sounds like too much trouble.
Yeah, I'm starting to suspect that we're just working with different definitions of "afford". According to the bank I can afford a $2M mansion. But based on your comments I don't think that's what you're suggesting :-)
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How to budget properly.... and maybe an introduction to the idea that I didn't have to work until I was 70 if I had apportioned my funds appropriately.
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First, credit cards -- do not fall prey to them. The card companies hand them out like free doughnuts at college sporting events and other campus functions. When you walk by their booth, forget the stupid free t-shirt and give them the hearty middle finger they deserve for the predatory nature of their business model and their attempts to ensnare you.
Second, those student loans have to be paid back -- in spades. So if you are yucking it up with friends on weekends on your student loan dime, or buying $4 lattes every day, you are digging yourself a deep, totally unnecessary hole you are going to likely spend years crawling out of.
It all seems so benign when you're doing it, but take it from someone who did -- it is not. Indentured servititude is no less odious or burdensome in this day and age than it was in the past.
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Stay away from redheads and motorcycles.
Red hair, and black leather, my favorite color scheme! (credit to Richard Thompson, and really more descriptive of my husband than myself, but too good to pass up!)
haha! great minds . . . I was going to post the same lyric! LOVE Del McCoury's version of this great Richard Thompson song.
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Go for what you want in life. You don't have to be a starving artist or a corporate drone if that's not what you want. Do what you want. If you're frugal, you'll be able to support yourself no matter what.
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I wish I knew "who I was" if that makes sense. When I was young, I spent a lot of time (and money) trying to be like everyone else. Embrace the uniqueness of you.
People with strong character shine without resorting to materialism.
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I wish I knew "who I was" if that makes sense. When I was young, I spent a lot of time (and money) trying to be like everyone else. Embrace the uniqueness of you.
People with strong character shine without resorting to materialism.
+2 I spent a lot of money trying to be part of the in crowd and have lots of friends. Only to find out that I didn't like who I became and those people weren't truely my friends anyway.
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Learn to distinguish between your NEEDS and your WANTS.
For instance you may NEED a cellphone but you will WANT the newest I-phone.
Looking at all of your decisions about any purchase to see if you need it or want it should make you make better decisions. Also when you are older you won't be throwing out or donating all of those bad buying decisions that you made and wondering what your life would have been like if you had made better decisions.
Jan
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Dont open up the Credit Card envelopes that will fill your mail box.
Save as much as you can and only buy what you can afford
accept mistakes you make, learn from them and move on.
Set realistic goals so they can be achieved
15 minutes of fun could cost you a fortune.
Dont try to disprove the older smart people around you , instead embrace there knowledge you are not smarter than they are.
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+1 to everything said before, especially about treating your body well and traveling.
Also, take risks in your career. Trust me, there is nothing worse than taking the "safe" option and then feeling stuck in a dead-end job for several years. Especially if that job isn't increasing your skills in any meaningful way. Basically, I wish I'd known that I was worth a whole lot more than the job I took.
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Take care of your driving record. Having a crappy driving record is a huge financial land mine that you can step on that will cost you dearly. Slow down, leave a bit early, never drive when you might even be a teensy tiny bit drunk or stoned. Relax and drive like an old lady, you’ll likely live longer and save a ton of money.
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Affecting a posture of weary cynicism isn't the same as maturity and sophistication.
I wasted an awful lot of time in college being a disagreeable jerk because it gave me a sense of smug moral superiority. Bummer.
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I thought of one more: be careful if you ever find yourself thinking "I deserve this." What makes you so deserving? Sure, you work hard. But so do lots of other people. It's a gateway thought that leads a lot of people into trouble, and I don't just mean money trouble. If you want to justify something to yourself, find a good reason for it. But telling yourself that you "deserve" something is probably the most dangerous thought you could have.
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^^^^
+1 to this. Life throws so many curveballs that thinking you 'deserve' something is the wrong idea to have.
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^^^^
+1 to this. Life throws so many curveballs that thinking you 'deserve' something is the wrong idea to have.
Depends on the something, I'd say. Material objects, yes to all of the above. But I see the occasional student in this age range who clearly hasn't determined that he/she deserves to be treated with respect, like any other person, or deserves a safe and sane relationship, or none at all. Just saying that the time of coming into adulthood is a time of vulnerability, and there are things every human being deserves. Generally, they're free, which is a perk.
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If you don't have a car yet, stay car-free as long as you possibly can! I managed until I was 27 (that is, until 4 months ago) and it saved me a fortune. It's amazing how much of a money pit those things are (and my first car is 16 years old!).
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Don't get addicted to things. Protip: if you ever think, "Man, I really need a beer," you are addicted. I learned this from Richard Feynman's book, and it is so true.
I just read The Fantastic Mr. Feynman, great read! I totally agree with that quote as well.
I wish I had known how much i wasting my money by borrowing money for cars. I luckily didn't buy new, but I didn't go cheap either.
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This may be anticlimactic, but I do not wish that my 20 year old self knew anything what I know now. I'm still wrestling with the consequences of what he unleashed, but in a good way. My DW started talking about taking it down a notch or two only last year - she was serious. That was the first time that I took inventory and lo and behold everything for FIRE was in place with only a couple of years of fine tuning left to do.
I can no longer relate to my mindset 30 years ago. The recklessness of quitting jobs for no better reason than a mild sense of boredom or a romantic interest somewhere else is quite incomprehensible to me at this point. One thing though I still relate to: Never, ever regret anything (think about it: it makes you very conscious about the consequences of anything you do, it is a big picture thing I have been conscious of as long as I can remember)
I'm older and perhaps wiser and I find it actually to be rather pleasant to take my DW's interests and plans into account - this is not something coming naturally to me, I usually expect others to just join the ride.
No, I have nothing to tell my younger self - he was better at doing what he had to do then just as I am better at doing what I have to do now. And he wouldn't have listened anyway....
And tomorrow is a new day....
Peter
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20 year old Travis, don't be so afraid of the stock market. Compound interest is your friend! Also, you don't need new everything. I didn't learn either of those lessons until recently (I'm 33 now).
I had no problem doing basic (but not great) budgeting in my 20s. I saved 15% of my income during my 20s, but it stayed in a savings account the whole time. I contributed a little to TSP and dabbled in my ROTH IRA, but I didn't become a serious investor until a year ago. Some nights I pull my hair out calculating blown opportunities in the market. I bought way too much house 4 years ago and had to sell it 2 years later after dumping thousands into upkeep. I paid cash for a giant truck the same year. I'm selling it next week for 50% of its original sale price.
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^^^^
+1 to this. Life throws so many curveballs that thinking you 'deserve' something is the wrong idea to have.
Depends on the something, I'd say. Material objects, yes to all of the above. But I see the occasional student in this age range who clearly hasn't determined that he/she deserves to be treated with respect, like any other person, or deserves a safe and sane relationship, or none at all. Just saying that the time of coming into adulthood is a time of vulnerability, and there are things every human being deserves. Generally, they're free, which is a perk.
Yes, I was mostly responding to material things. The "I deserve an expensive massage!" mindset you hear from so many people. And while there are certain lifestyle things everyone deserves, it does pay to take a look at what you really need. My husband and I lived in cabin without running water for 6 months (we had to use an outhouse, even when it dropped down to -60F for two weeks) because we didn't ever turn our noses up at it and tell ourselves that we deserved running water.
In fact, we'd have stayed there a lot longer if they weren't all so far out of town.
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I wish I'd read The Gentle Art of Verbal Self Defense sooner.
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Design your future lifestyle on paper; what do you want from life - lifestyles of the rich & famous, working as a wildlife biologist (therefore little need for a home as always out in the field), joining the Merchant Marine, etc.? This will take more than a couple of hours. After the plans seem to gel, talk this plan over with your parents as they may know you best of all. Modify plan as needed. Then, work back from plan to present day. Go for part-time jobs & volunteer activities that are in part of the planned lifestyle; you need this actual feedback from real life. Just reading about it fails. Revise plan every year until graduation
Find/date potential mates whose lifestyle plans are same as yours. Marry fairly young (by 24?), but put off children for 2 to 3 years. This will give you time to do things together; big canoe trip, hiking across Europe, sailing to Cabo, whatever. Put off buying stuff. You need not furnish every room of the apartment or house. Having stuff is like having an anchor; stuff soon owns you. Stuff makes it harder to leave for lengthier activities such as have time for two weeks in Thailand, but don't have money since you have stuff instead.
Oh, yeah. Get proficient in public speaking; this will stand you in good stead whatever path you take. Learn some practical skills such as cooking from scratch, how to sew on a button and ballroom dancing.
College is not the time for making big bucks even though some seem to do it. It's more a time for learning and developing certain skills - whether in the classroom, student clubs or the community at large.
Sorry, but I always found semester abroad to be over priced and self indulgent. You do need serious play in your life. Going to the beach on Spring Break and getting wasted is not it. Getting a scholarship to help build a school in Belize during term break combined with touring part of the country was better. Christmas break was always several weeks; look for a Christmas internship in your planned field while staying home. Your parents will age and then die all too soon. Participate in the family rituals as corny as they may be.
On the job volunteer for assignments that may be a little above your skill set. This will reward you
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I suppose the big thing for me (that's relevant to others) would be telling my 20 year old self that my parents are still winging it at being these mythical "adults" I've read about a few times.
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I suppose the big thing for me (that's relevant to others) would be telling my 20 year old self that my parents are still winging it at being these mythical "adults" I've read about a few times.
And that you, too, will just be making it up as you go along for many years yet so you may as well just enjoy it :-)
I've realised that I will never feel like an adult. But that's okay.
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I suppose the big thing for me (that's relevant to others) would be telling my 20 year old self that my parents are still winging it at being these mythical "adults" I've read about a few times.
And that you, too, will just be making it up as you go along for many years yet so you may as well just enjoy it :-)
I've realised that I will never feel like an adult. But that's okay.
That'd be an interesting discussion to have in another (new) thread - do you feel like an adult and if so, at approximately what age did it happen?
Cause I felt the same as you a few years ago, but I don't anymore (I'm a few years older than you).
Interesting, but not on topic, so back to it..
:)
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I would have told myself that going to college would be the best decision you will make, your friends at home will not amount to anything.
-No matter how much fun it sounds, driving a racing lawn mower drunk on a sidewalk won't be fun when you get caught.
-Pay extra toward your house early, more than what you did.
-Don't buy a classic car, it won't loose value, but won't gain enough to make it worth keeping. (Which reminds me I need to sell it still.)
-Don't buy the biggest house on the block, it'll bite you if you ever decide to sell.
-Nothing good happens after midnight, unless you are one of the sober ones.
-Always use protection even after married unless you want kids sooner than you planned.
-You are capable of more than you think, you just need to suck it up and try harder.
-You'll be successful, just stick to your plan and don't be afraid to change your plan when the need arises.
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I would have told myself that going to college would be the best decision you will make, your friends at home will not amount to anything.
-No matter how much fun it sounds, driving a racing lawn mower drunk on a sidewalk won't be fun when you get caught.
-Pay extra toward your house early, more than what you did.
-Don't buy a classic car, it won't loose value, but won't gain enough to make it worth keeping. (Which reminds me I need to sell it still.)
-Don't buy the biggest house on the block, it'll bite you if you ever decide to sell.
-Nothing good happens after midnight, unless you are one of the sober ones.
-Always use protection even after married unless you want kids sooner than you planned.
-You are capable of more than you think, you just need to suck it up and try harder.
-You'll be successful, just stick to your plan and don't be afraid to change your plan when the need arises.
What classic car do you have? :)
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...Don't get addicted to things. Protip: if you ever think, "Man, I really need a beer," you are addicted...
FT(MF)W. Why do so many people not GET that?
I have to disagree, or at least clarify. About a half dozen times a year, I'll think "Man, I really need a beer" - typically after after mowing the lawn on a hot summer day, right after I shower off all the sweat. Since my beer consumption averages around 2 beers per month, I really can't believe it is any kind of addiction.
Now, if someone is using that statement on a frequent basis - sure.
The problem is that you don't 'need' a beer... it should say "Man, I really would like/love a beer". I probably get just as much enjoyment from an ice cold glass of filtered water after/during mowing then a beer would provide!
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I would have told myself that going to college would be the best decision you will make, your friends at home will not amount to anything.
-No matter how much fun it sounds, driving a racing lawn mower drunk on a sidewalk won't be fun when you get caught.
-Pay extra toward your house early, more than what you did.
-Don't buy a classic car, it won't loose value, but won't gain enough to make it worth keeping. (Which reminds me I need to sell it still.)
-Don't buy the biggest house on the block, it'll bite you if you ever decide to sell.
-Nothing good happens after midnight, unless you are one of the sober ones.
-Always use protection even after married unless you want kids sooner than you planned.
-You are capable of more than you think, you just need to suck it up and try harder.
-You'll be successful, just stick to your plan and don't be afraid to change your plan when the need arises.
What classic car do you have? :)
I have the car in my avatar, it is a replica of a 66 Shelby Cobra 427, I couldn't bring myself to pay the extra for a 427, but it does have a 351w and at 2,400 lbs is it a joy to drive.
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I would have told myself that going to college would be the best decision you will make, your friends at home will not amount to anything.
-No matter how much fun it sounds, driving a racing lawn mower drunk on a sidewalk won't be fun when you get caught.
-Pay extra toward your house early, more than what you did.
-Don't buy a classic car, it won't loose value, but won't gain enough to make it worth keeping. (Which reminds me I need to sell it still.)
-Don't buy the biggest house on the block, it'll bite you if you ever decide to sell.
-Nothing good happens after midnight, unless you are one of the sober ones.
-Always use protection even after married unless you want kids sooner than you planned.
-You are capable of more than you think, you just need to suck it up and try harder.
-You'll be successful, just stick to your plan and don't be afraid to change your plan when the need arises.
What classic car do you have? :)
I have the car in my avatar, it is a replica of a 66 Shelby Cobra 427, I couldn't bring myself to pay the extra for a 427, but it does have a 351w and at 2,400 lbs is it a joy to drive.
Duh I should have looked at your avatar. :) Anyway nice car!!! I am sure its fun to drive. Talking about a cobra, I met a african american guy who has an 64 (yr not sure but close)original cobra. The motor size for his car was a 287 original I believe. I believe he was a pit crew for Caroll shelby. I am not sure if you follow cobras history or you know of him. He tours around the country to show his car. He is a nice guy.
Thanks for sharing your car experience here.
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I wish I knew "who I was" if that makes sense. When I was young, I spent a lot of time (and money) trying to be like everyone else. Embrace the uniqueness of you.
People with strong character shine without resorting to materialism.
Very yes!
It took me years to figure out "who I am."
Actually, I'm still working on it, but I moved across country several times, just to get myself away from all the people that were defining me by the way I'd always been so I could figure out what I like when I was in new situations. I'm sure everyone doesn't need to be that extreme. For me, it helped reveal my "core" that was independent of what I was like around other people, and that was good to know.
Now I feel more grounded. I know the reasons I'm doing things: the jobs I have, the houses I own, why I do what I do... and it's so freeing! I love it.
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I have the car in my avatar, it is a replica of a 66 Shelby Cobra 427, I couldn't bring myself to pay the extra for a 427, but it does have a 351w and at 2,400 lbs is it a joy to drive.
Duh I should have looked at your avatar. :) Anyway nice car!!! I am sure its fun to drive. Talking about a cobra, I met a african american guy who has an 64 (yr not sure but close)original cobra. The motor size for his car was a 287 original I believe. I believe he was a pit crew for Caroll shelby. I am not sure if you follow cobras history or you know of him. He tours around the country to show his car. He is a nice guy.
Thanks for sharing your car experience here.
I know who you are talking about, but am having a sr. moment (at 28, but with a 1 month old and no sleep) I've never actually met him but have seen a few of his interviews and exploits. He has some great stories and is the real deal. His was a 289, and very original cobra probably worth enough for either of us to retire with excess. Sorry for the hijack to the OP, PM me if you'd like.
James
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This post from Jacob sums up the most important thing I needed to know about money at 20:
http://earlyretirementextreme.com/update-3-interesting-spreadsheet-calculation.html
It's an illustration of how important starting fast is to compound interest. Even if you chill out on savings later.
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Advice for my 20 year old self:
Spend more time with your grandparents - they will be gone much sooner than you think
Stop spending so much money/time on clothes/appearance -- you look fine, and it doesn't matter as much as you think (but the money spent on travel was okay)
Save in a Roth IRA (I didn't know about these until I was 30-ish)
Don't bother with the master's degree in English (although it indirectly led to my current career)
Stop dating that loser
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Stop dating that loser
Sorry, I had to LOL at that.
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Advice for my 20 year old self:
Spend more time with your grandparents - they will be gone much sooner than you think
This really rings true with me. I'm 23, and feel really blessed to have all my grandparents living. I'm hoping my kids are lucky enough to actually have memories of them, since they're all extremely kind people.
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To stick with holdem poker and not other games... probably would be 30k richer :)
Either than that I don't regret much if anything at all, I'm 35 now. As much as I didn't want a "typical" lifestyle then... house, wife, kids, car, house in the burbs... lol. It all turn out like that! Ha! I never wanted to work past 45 and I'm still on track (or earlier) for that.
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Don't take life too seriously - remember to smile and to be nice to people - collect friends - be grateful and humble
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I haven't "learned" this yet but one of my grandfathers favorite sayings is "be kind to your knees and back. You will miss them when they are gone"
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I haven't "learned" this yet but one of my grandfathers favorite sayings is "be kind to your knees and back. You will miss them when they are gone"
Did he also say to wear sunscreen? :D
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I haven't "learned" this yet but one of my grandfathers favorite sayings is "be kind to your knees and back. You will miss them when they are gone"
Did he also say to wear sunscreen? :D
No on the sunscreen. I know what you are getting at lol. He was a butcher his whole life and the years of standing on concrete and hauling quarters of beef around really took its toll. Still learn something every time I get to sit down and have a conversation with him though.
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The amount of money and time I spent on acquiring STUFF - how I wish I had known then what I know now. Stuff does not make you happy or your life better. Took me 40+ years to realize that it's not things that are the most important but memories, people, family, adventures.
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The amount of money and time I spent on acquiring STUFF - how I wish I had known then what I know now. Stuff does not make you happy or your life better. Took me 40+ years to realize that it's not things that are the most important but memories, people, family, adventures.
mm, yes:
"The world is too much with us; late and soon,
Getting and spending, we lay waste our powers..."
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Advice for my 20 year old self:
Spend more time with your grandparents - they will be gone much sooner than you think
This really rings true with me. I'm 23, and feel really blessed to have all my grandparents living. I'm hoping my kids are lucky enough to actually have memories of them, since they're all extremely kind people.
Yes!!! This one is huge. I lost my first one at 24. Now, at 35, I have two in very bad health. Ask them lots of questions now because often their memory is gone before they are...
Do the same with parents, even if you think it's too early. The time will go faster than you can believe.
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When I was 20 I thought only millionaires had investments. I wish I would have known something about investing. That just investing money in a global fund is an option, that you can (and should) not only put money in a savings account. Even if it's only a little bit a month.
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Don't Charge it if you don't have it.
You don't need as many student loans as they say you are eligible
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To 20 yr old faded (only at 23 now, but 20 feels like eons ago)
1. Appreciate the feeling of your first relationship, even if it is long distance across an ocean and you never got in a visit edgewise. It could be much worse, your first could have been abusive, and he wasn't. The love was real, and he'll definitely be gone long before you think.
2. For god sakes, read practical personal finance and just DO IT! For all that you're a junior in business school, personal finance should be easier to pick up for you. Invest in a mutual fund even just 3k of your tutoring money.
3. Don't buy lunch out everyday. The school DOES have a microwave, and it will really help your student budget and desire to lose weight.
4. Don't go to law school. Yet. You will enjoy all law has to offer, but you will regret the work experience you're missing, and feel like you can't relate to your older law school peers who have worked and have some savings to decrease loans. Had you done this, maybe you'll realize grad school won't be necessary.
5. Get thee to counseling sooner-its actually pretty useful.
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The end is far. If/when you have that first big breakup - I remember feeling like everything had ended and I would never find anyone I had that kind of connection with again. It wasn't true, but it was a long time before I realized it. If you are open to experience, the universe will yield surprising opportunities, both romantically and non-romantically, not all of which you might have anticipated ahead of time.
Life and identity are fluid. There is always something new we can learn. Accepting this with grace and curiosity is key to living a good life.
Don't compare yourself to others, only compare yourself to yourself and be the best you can be. Comparison and envy can cause a world of unnecessary hurt.
I was very good about putting money away and being responsible at 20, so I don't think I would have really changed much there. Neither would I have gone back on my decision to take a working holiday in Australia at 23 and take the opportunity to backpack all over the country. It was a magical experience that would be difficult to pull off now that I'm older and have more commitments tying me down, and probably one of the best experiences I've ever had.
Your metabolism is going to slow down, so learn healthy living habits now before you start paying the consequences.
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The #1 thing I wish I knew was to pick a useful major in college and do whatever it takes to look for scholarships and grants. I did neither and am paying the price! Luckily I'm getting paid, and paying nothing myself, to go back to school for something useful. If anything, this was a blessing in disguise to help me really get serious about money management.
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the actual words to "Louie Louie".
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Get more sleep, and go to sleep at more regular times. It took me 10 years to finally stop sleep binging when I crashed from lack of sleep.
Start exercising and stop putting it off.
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I haven't read everything. And this is kind of stupid...because I *knew* it then but I think it needs to be said.
DO stuff. Take action.
You can read about investing, you can read Your Money or Your Life and the Millionaire Next Door, you can live a moderately frugal existence and be interested in finances...BUT if you never act or take the next steps you won't get very far. I come to this party late (early 40s) not because I didn't already know this stuff; I did. I am here late because I didn't put my knowledge into action. Or to be more specific, I did not act fully. Like, some how I thought knowing it and understanding it was the same as doing...and it very obviously isn't. (For me, in hindsight, I would have told myself to take the risk of doing something, even the wrong thing, over doing nothing (beyond a savings account and 401k) because the younger you are the more time you have to correct mistakes. Probably a self-esteem/fear of failure issue on my part!)
Similarly, 20 is a great time to experience life on the cheap. No one expects you to have your shit together. If you want to travel and bum around for a year or so, 20 is the time to do it. I wanted (well, I still do want to) thru hike the AT. At the moment, I have a full time job, a husband (who has zero interest in doing this), a 6yo and live west of the Mississippi...which makes this goal a little unacheivable...for the moment. I guess I'd say, imagine yourself a little older with "responsibilities" (I don't want to give the impression that these are bad...or that yours will be the same as mine. I mean, if you do retire early then you will have more flexibility than I do!) and think about how those might impact some of your goals. There are things you can work around life commitments (sounds a little better than responsibilities, heh.) and things that might be more inflexible. DO the more inflexible stuff now.
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This thread struck a cord with me as I have some teenage nephews and niece that I have been trying to guide in a positive direction. As you would think, with teenagers, they're not terribly interested as they already know everything.
Advice I wish I would have gotten:
1. Don't waste your money (My dad did try but, his reasons weren't compelling enough so I spent and spent)
2. Sock away something in savings (I remember working for $2.00 an hour so I usually ended up spending most of it)
3. Strive to learn something new everyday (With internet at your finger tips today it's easier than ever!)
4. Don't let appearances fool you. (people who "appear" rich with new cars and fancy clothes are usually poor) The quote I like is from the infamous R. Kiyosaki from RDPD books. He calls it "looking good and going nowhere".
5. Don't waste time... You will be older every year. Lots of things that you think you can put off till later in life will creep up on you faster than you think. (I pissed around when I was younger. I had to learn the hard way that an education might open a few more doors for me. I started college at 18. I finished my B.S. at 27 (IIRC?). If I would have known what I know now...
6. Don't be afraid to ask questions. If you don't know, you don't know. ASK. (Some people will tell you "google it" and that's fine but, sometimes you just need to ask the seemingly stupid questions and move on.
7. Do not despair, tomorrow is another day- a new opportunity.
Advice that I can impart:
1. learn to drive a stick shift (majority of young people can't drive them- probably less likely to get carjacked if the perp can't drive a manual)
2. learn the basics (how to do stuff like cook, laundry, how to properly clean, work on your own car, fix things in general - paying people to do stuff for you gets expensive)
3. No children, yet (until you can properly take care of yourself, you cannot properly take care of a child)
4. If you go to college, focus and do what you need to do. Don't waste time and money skipping and getting crap grades.
5. If you can't focus on college, don't flounder. Go somewhere, do something (for me it was Army)
6. Get out of your comfort zone. If it's easy, you get complacent and dig your own rut.
7. Move out of the area. Get away from your idiot friends that drag you down and go start a new adventure.
8. Work ethic- get it.
9. Your handshake= your word= your "credit"
10. Don't avoid something because you're afraid to fail (like a friend once told me- "If you're going to fail, fail gloriously!")
11. Life is short. Time really does fly. Spend time with the old folks- they will be gone soon enough
12. Chat with old folks, ask them questions. They're usually happy to chat and are often fountains of great information
13. Learn to spell (text spelling is NOT spelling- nothing irks me more than terrible spelling)
14. Take care of yourself. (exercise, diet, dental, vision, etc.) I used to be invincible too- now, not so much.
15. Take heed. I think it was Edison that said "Opportunity is missed by most people because it is dressed in overalls and looks like work"
I think that's enough for now.
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I just wanted to say thankyou to everyone who posted. As someone getting started in FIRE and life in general (I'm 19), I can see that the advice here is sound and will be of great use.
Thankyou!
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I just wanted to say thankyou to everyone who posted. As someone getting started in FIRE and life in general (I'm 19), I can see that the advice here is sound and will be of great use.
Thankyou!
Honestly: If you're starting a FIRE path at 19 -- you're so far ahead of most of us that you don't need a lot of advice. I think I mildly started in my early 30s and aimed at a FIRE with a relatively high spending rate.
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Given how my marriage has been lately -
That girl you are dating. Keep her. You'll be happier. Don't be afraid just because it is your first serious relationship.
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I'm 22.
Buy bitcoin.
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Don't go to law school.
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Stay away from redheads and motorcycles.
Red hair, and black leather, my favorite color scheme! (credit to Richard Thompson, and really more descriptive of my husband than myself, but too good to pass up!)
haha! great minds . . . I was going to post the same lyric! LOVE Del McCoury's version of this great Richard Thompson song.
This must be why I'm still single, my red hair scaring all the men away ;-)
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1. Give the same respect to people (no matter who they are) that they show you, and vice versa (this saved me some total dud relationships)
2. Spend time with the parent/s you're closest with, they won't be around for ever.
3. Walk away from relationships that drag you down (even if its your family).
4. Pay yourself first, even if its only a little bit at first.
5. Have fun- go to that party and let loose when you feel like it. Have that bowl of ice cream because you had a good/bad day. Laugh with your friends. Travel everywhere you get the chance. Don't be shy around people you're attracted to. Stay up all night watching the stars. Kiss that boy you thought you'd never have a chance with. Go to festivals. Try new things even if they're scary. Take a leap of faith.
6. Find things you're interested in and then go and actually do them!
7. Value the truly great people in life.
8. Learn to look after yourself.
9. If you don't like university, quit. You can always go back.
10. If you don't like your job, stay long enough to get a reference before you leave.
11. Apply for random jobs you think sound interesting even if you don't have the pre-requisites, they may just end up being your dream job!
12. Learn at least one other language.
13. Learn how to dance properly, not just a drunken stumble (and no, just because you're drunk doesn't mean you can suddenly dance well).
14. Don't be afraid to do something just because someone else told you it wasn't going to work.
15. Be frugal but not cheap.
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Max out that Roth, baby. And don't be afraid to the point of paralysis of making a mistake.
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I wish I would have known where the G-spot was. I didn't learn that until like 21.
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I wish I would have known where the G-spot was. I didn't learn that until like 21.
Where is it? I am still searching.
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This thread is awesome.
Although 20 was not long ago at all for me, I would offer myself this advice:
You don't need to stay with your boyfriend just because you've been together since age 16. You can both see that the relationship is going nowhere fast, so get out. Now.
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I wish I had read these books when I was 20 (in order)
Your Money or Your Life by Joe Dominguez, Vicki Robin
The Millionaire Next Door by Thomas J. Stanley, William Danko
A Random Walk Down Wall Street by Burton G. Malkiel
I think YMOYL might have appealed to me as a 20 year old but the Millionaire Next Door would have probably made me angry and not helped. We're still growing up at that age.
This is so true. When I was 20, (am only 22 now) a friend of mine borrowed me the book Millionaire Next Door. I read about half of it, and would always cry my eyes out after reading because I felt like I'd already messed up my whole life. Now after reading MMM and all of your inspiring posts, I feel like I can get on track to financial freedom within 10-15 years.
Thanks to everyone who has posted their advice for us young Mustachians. :)
...I guess I should still read the book Your Money or Your Life, what do you all think?
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I wish I had read these books when I was 20 (in order)
Your Money or Your Life by Joe Dominguez, Vicki Robin
The Millionaire Next Door by Thomas J. Stanley, William Danko
A Random Walk Down Wall Street by Burton G. Malkiel
I think YMOYL might have appealed to me as a 20 year old but the Millionaire Next Door would have probably made me angry and not helped. We're still growing up at that age.
This is so true. When I was 20, (am only 22 now) a friend of mine borrowed me the book Millionaire Next Door. I read about half of it, and would always cry my eyes out after reading because I felt like I'd already messed up my whole life. Now after reading MMM and all of your inspiring posts, I feel like I can get on track to financial freedom within 10-15 years.
Thanks to everyone who has posted their advice for us young Mustachians. :)
...I guess I should still read the book Your Money or Your Life, what do you all think?
Also 22
YMOYL was pretty much like: you have nothing to show for all the years you've worked (go to ssa.gov, look at your lifetime earnings, and cry). Figure out how to live like a Mustachian, focus on the things you value, and free yourself from wage slavery.
So while it was worth some time, it's not going to be substantially different or better than Mr. Money Mustache.
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Also 22
YMOYL was pretty much like: you have nothing to show for all the years you've worked (go to ssa.gov, look at your lifetime earnings, and cry). Figure out how to live like a Mustachian, focus on the things you value, and free yourself from wage slavery.
So while it was worth some time, it's not going to be substantially different or better than Mr. Money Mustache.
Wow ch12... Thank you! I haven't cried over it yet because I'm feeling positive about this, but my ssa.gov shows I have already made $167,754 in just 7 short years. Most of it in the last 3.5, but I have spent it all (and more). I knew I had made over $100,000 already, as I posted in my intro post, but that is just crazy. At least now I know what to do to change my ways, and I can make the same amount in the next 3 years or less. Plus I will be saving A LOT more of it!
I think I will still read the book someday. When I get it from the library :)
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A thing I wish I'd known at twenty: Don't get your food advice from the same people as your music advice.
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What I wish I knew: If you don't like your career trajectory, change it before you get good at it. I've only been working for five years, but it is already hard for me to leave my career because I don't want to start over on the bottom of the pay scale. Also, I wish I knew that people a lot stupider than me are doing much cooler things than me. I shouldn't have let desire for money hold me back so soon in life.
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What I wish I knew: If you don't like your career trajectory, change it before you get good at it. I've only been working for five years, but it is already hard for me to leave my career because I don't want to start over on the bottom of the pay scale. Also, I wish I knew that people a lot stupider than me are doing much cooler things than me. I shouldn't have let desire for money hold me back so soon in life.
And in five years you'll be posting in the "what you wish you knew when you were 30" thread that you wish you would have known that you can change your career path at only five years in, but at at ten it's definitely too late.. ;)
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What I wish I knew: If you don't like your career trajectory, change it before you get good at it. I've only been working for five years, but it is already hard for me to leave my career because I don't want to start over on the bottom of the pay scale. Also, I wish I knew that people a lot stupider than me are doing much cooler things than me. I shouldn't have let desire for money hold me back so soon in life.
Can you elaborate a bit? This seriously resonated with me since I'm 3 years into an IT career and considering changing it. I guess I'm most interested in what people stupider than you are doing--and if what they're doing is making more money or if it's less money but cooler.
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A lot of good advice here, but I will say one thing about *saving* when young.
I grew up in a fairly *poor* environment, my parents immigrated to North America from a pretty shitty place to give me a better life. They both worked numerous jobs, etc so I didn't grow up with luxuries, had to pay for my own school, worked since I was 13, etc. Why is this relevant?
Depending on your skill set and what you think your earning power will be, I wouldn't advise saving 50% or whatever the norm is here when you aren't making much money especially right out of school. You need to live life within reason, and on a smaller salary after 50% is saved, you simply don't have much in terms of options. I am not saying for you to go to Europe on a 10k vacation because everyone else is doing it or to buy a brand new car on a 40k/year annual salary for a fresh college grad, but within reason you need to do things, enjoy life, experience things, etc. You will not necessarily get that chance later on in life and it's just not the same when you are older.
The key is watch for lifestyle inflation. If you can be happy on that 40k with a little bit saved up then you are golden because once you get to 60k/year, it's all gravy, and at 80k that's even more, and so on. Personally in my early/mid 20's I made 45k/year and worked ridiculous hours. Saving was practically impossible after paying bills, living on my own in a high COLA city. I wanted to save, but it was difficult unless I wanted no social life/hobbies. Since then I've tripled my income (30 years old now) and saving is a lot easier mostly because of how much I make, but most importantly for not falling into the lifestyle inflation trap. Right now I could save 50% and still have plenty left over, other times I will save 80%, it depends, the point is there is flexibility. To save on a low salary at the expense of living like a hermit in your 20's (some of your best years) I simply don't think it's worth it.
Don't stress if you aren't hitting insane savings rates at that age, be warned, when you and your buddies get that promotion to 75k, they will all ditch the civics for entry level BMWs and maybe a small condo, at 100k they will want a bigger home and the SUV to boot, it's a never ending cycle and most people fall into that trap. Not having much to your name at 40k in your 20's is no big deal, not having anything to your name 5+ years after school at double that salary then you know you are doing something wrong.
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What I wish I knew: If you don't like your career trajectory, change it before you get good at it. I've only been working for five years, but it is already hard for me to leave my career because I don't want to start over on the bottom of the pay scale. Also, I wish I knew that people a lot stupider than me are doing much cooler things than me. I shouldn't have let desire for money hold me back so soon in life.
And in five years you'll be posting in the "what you wish you knew when you were 30" thread that you wish you would have known that you can change your career path at only five years in, but at at ten it's definitely too late.. ;)
Yeah. Take out the "have" in that sentence, and then you can do what arebelspy suggests.
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I know this is an old thread, but I'm bumping it because I find these types of discussions insightful. After reading the advice of previous posters, I have to keep reminding myself that I need to get serious about treating my body better. It's so easy to forget next to Sunday brunch and an afternoon nap.
If I had one thing to add to this thread it would be that you do not have an obligation to maintain a relationship with your family. Do what you must to honestly try to repair relationships that need it. Then, if things still aren't working, walk away knowing that you tried. Stringing along destructive relationships just because they're family will do you much more harm than good.