Author Topic: Things you wish you knew when you were 20  (Read 51228 times)

luke15

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Things you wish you knew when you were 20
« on: March 18, 2013, 09:13:32 PM »
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!

Self-employed-swami

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Re: Things you wish you knew when you were 20
« Reply #1 on: March 18, 2013, 09:32:16 PM »
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.


marty998

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Re: Things you wish you knew when you were 20
« Reply #2 on: March 18, 2013, 10:18:27 PM »
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!

MountainMan

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Re: Things you wish you knew when you were 20
« Reply #3 on: March 18, 2013, 11:08:06 PM »
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.

Erica/NWEdible

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Re: Things you wish you knew when you were 20
« Reply #4 on: March 19, 2013, 02:00:42 AM »
A huge chunk of your future happiness (or not) will be strongly influenced by the person you choose to partner with.

Dee18

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Re: Things you wish you knew when you were 20
« Reply #5 on: March 19, 2013, 05:10:39 AM »
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. 

Heather

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Re: Things you wish you knew when you were 20
« Reply #6 on: March 19, 2013, 05:27:57 AM »
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.





gecko10x

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Re: Things you wish you knew when you were 20
« Reply #7 on: March 19, 2013, 07:48:48 AM »
[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.

mobilisinmobili

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Re: Things you wish you knew when you were 20
« Reply #8 on: March 19, 2013, 08:33:54 AM »
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.

CheckEngineLight

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Re: Things you wish you knew when you were 20
« Reply #9 on: March 19, 2013, 11:09:50 AM »
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. 
« Last Edit: March 19, 2013, 11:11:28 AM by CheckEngineLight »

brewer12345

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Re: Things you wish you knew when you were 20
« Reply #10 on: March 19, 2013, 11:30:49 AM »
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.

No Name Guy

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Re: Things you wish you knew when you were 20
« Reply #11 on: March 19, 2013, 11:41:02 AM »
The math of FI / ER / being Independently wealthy that MMM and Jacob of ERE laid out in a perfectly clear manner.

tooqk4u22

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Re: Things you wish you knew when you were 20
« Reply #12 on: March 19, 2013, 12:00:12 PM »
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. 

kisserofsinners

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Re: Things you wish you knew when you were 20
« Reply #13 on: March 19, 2013, 12:03:45 PM »
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)

capital

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Re: Things you wish you knew when you were 20
« Reply #14 on: March 19, 2013, 12:55:10 PM »
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.

bogart

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Re: Things you wish you knew when you were 20
« Reply #15 on: March 19, 2013, 01:08:38 PM »
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. 

savingtofreedom

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Re: Things you wish you knew when you were 20
« Reply #16 on: March 19, 2013, 08:27:44 PM »
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.

WageSlave

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Re: Things you wish you knew when you were 20
« Reply #17 on: March 20, 2013, 05:07:55 PM »
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.

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.


Zaga

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Re: Things you wish you knew when you were 20
« Reply #18 on: March 20, 2013, 05:44:22 PM »
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!

projekt

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Re: Things you wish you knew when you were 20
« Reply #19 on: March 20, 2013, 05:47:49 PM »
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.

sol

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Re: Things you wish you knew when you were 20
« Reply #20 on: March 20, 2013, 06:13:46 PM »
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.

kt

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Re: Things you wish you knew when you were 20
« Reply #21 on: March 21, 2013, 03:42:43 AM »
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.

unplugged

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Re: Things you wish you knew when you were 20
« Reply #22 on: March 21, 2013, 06:16:22 AM »
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)

« Last Edit: March 21, 2013, 06:27:11 AM by unplugged »

catmustache

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Re: Things you wish you knew when you were 20
« Reply #23 on: March 22, 2013, 02:32:47 PM »
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.

Spork

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Re: Things you wish you knew when you were 20
« Reply #24 on: March 22, 2013, 03:02:36 PM »
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.

bogart

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Re: Things you wish you knew when you were 20
« Reply #25 on: March 22, 2013, 06:49:11 PM »
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!)

121 Seconds

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Know Your Limits
« Reply #26 on: March 24, 2013, 09:13:30 PM »
Without going into too much detail.

        Never attempt to hurdle a fixed object!


N

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Re: Things you wish you knew when you were 20
« Reply #27 on: March 24, 2013, 10:53:37 PM »
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!)

Scrooge

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Re: Things you wish you knew when you were 20
« Reply #28 on: March 25, 2013, 12:57:22 PM »
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.

mobilisinmobili

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Re: Things you wish you knew when you were 20
« Reply #29 on: March 25, 2013, 01:57:04 PM »
That I'd pretty damn badass by the time I'm 30.

kevinasher

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Re: Things you wish you knew when you were 20
« Reply #30 on: March 26, 2013, 01:45:35 AM »
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.

tuyop

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Re: Things you wish you knew when you were 20
« Reply #31 on: March 26, 2013, 06:51:17 AM »
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.

Vilx-

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Re: Things you wish you knew when you were 20
« Reply #32 on: March 26, 2013, 08:14:24 AM »
A lot of good stuff has been written here. But one eye-opener for me was this video (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.

Dynasty

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Re: Things you wish you knew when you were 20
« Reply #33 on: March 26, 2013, 01:11:57 PM »
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.


MsSindy

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Re: Things you wish you knew when you were 20
« Reply #34 on: March 29, 2013, 12:54:06 PM »
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.

Mrs MM

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Re: Things you wish you knew when you were 20
« Reply #35 on: March 29, 2013, 01:33:54 PM »
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

Stachsquatch

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Re: Things you wish you knew when you were 20
« Reply #36 on: March 29, 2013, 01:39:13 PM »
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.

tuyop

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Re: Things you wish you knew when you were 20
« Reply #37 on: March 29, 2013, 02:08:28 PM »
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. >.>

Nudelkopf

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Re: Things you wish you knew when you were 20
« Reply #38 on: March 29, 2013, 05:08:01 PM »
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 :)

Rich M

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Re: Things you wish you knew when you were 20
« Reply #39 on: March 29, 2013, 08:05:15 PM »
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.


Rich M

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Re: Things you wish you knew when you were 20
« Reply #40 on: March 29, 2013, 08:07:00 PM »
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

capital

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Re: Things you wish you knew when you were 20
« Reply #41 on: March 30, 2013, 02:23:30 PM »
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.

Inquizator

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Re: Things you wish you knew when you were 20
« Reply #42 on: March 30, 2013, 03:43:24 PM »
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.

matt_g

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Re: Things you wish you knew when you were 20
« Reply #43 on: March 30, 2013, 05:17:06 PM »
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

tuyop

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Re: Things you wish you knew when you were 20
« Reply #44 on: March 30, 2013, 08:41:52 PM »
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.

projekt

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Re: Things you wish you knew when you were 20
« Reply #45 on: April 01, 2013, 05:26:00 AM »
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.

merry3irwin

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Re: Things you wish you knew when you were 20
« Reply #46 on: June 14, 2013, 01:17:12 AM »
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.

Monkey Master

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Re: Things you wish you knew when you were 20
« Reply #47 on: June 14, 2013, 05:23:56 AM »
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?

merry3irwin

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Re: Things you wish you knew when you were 20
« Reply #48 on: June 14, 2013, 07:46:30 AM »
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?
« Last Edit: June 14, 2013, 07:53:00 AM by merry3irwin »

rubybeth

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Re: Things you wish you knew when you were 20
« Reply #49 on: June 14, 2013, 08:48:58 AM »
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!