Learning from experience is smart. We should all learn from mistakes as well as simply pick up knowledge and wisdom as we get older. That said, if we can get good advice early on – AND follow it – we should be ahead of the game.
Along those lines, I think it’s good to be able to offer financial advice to people younger, even if old enough that they’re just out of college and just starting out. Some of you might be at that stage now, or may have family at that point in life. I came across an article on US News that offers some good advice for those starting out, and below I’ll share the tips as well as my own opinion on each.
- Save one-third of your income. You know, at first glance this seems really hard to do for most people just starting out. I wouldn’t have been able to do it. However, I also made choices that made such an accomplishment unlikely – the primary one being graduating college and then moving to another city rather than going back to my home area. Living at home after college, if that’s an option, can truly help someone save one third of income. In many cultures and/or families, it’s no big deal and very normal to be living with Mom and Dad at that age. Why does it have to be weird and seem like freeloading? I say that despite not doing that myself.
- Don’t be stingy with career-related investments. I tend to agree with this. There are people that tend to think that once a person graduates from college, the need to invest in continual learning is over. Well, that’s not true, as we need to keep learning to make money. This could mean spending money to invest in yourself to get an edge in your career, or give you time to do so.
- Cultivate ambitious dreams. Again, I agree. With life ahead of you, there are so many possibilities. Why not try to shoot for the stars? If you land a bit lower, it’s still better than where you’ll end up if you aim low. It’s doesn’t get easier when you get older, as you have less time and more responsibilities.
- Pay off all but the cheapest student loans early. Makes sense to me. After reading about senior citizens with student loans, I think it’s a great idea to eradicate debt and work on becoming debt-free. There’s freedom involved in that situation!
- Don’t wait to start investing until you have extra money. The earlier you start, the better off you’ll be in the long run. The power of compounding on money is staggering, check it out!
- Give back on your own terms. I agree on both parts of that: giving, and on your own terms. I of course support helping others, as I’ve gone over here countless times. That said, nobody should force you into it and often times we might want to be careful to make sure that an organization we give to will actually use our money in a way we are comfortable with.
In addition to those tips provided, I have four more than came to mind, to make a combined list of 10 tips. Here are my own additional four tips:
- Don’t give in to financial peer pressure. People of all ages can be tempted to keep up with the Joneses. I would suggest not worrying about competing with others in terms of how much money they seem to have, where they live, and so on. Be aware of what’s possible, and be inspired. But don’t give in to pressure to keep up appearances, and don’t get sidetracked with unnecessary social competition
- Behave responsibly and be nice to people. Besides being the right thing to do, it’s also smart not to be obnoxious. With people getting googled by employers, and social media being used as a platform for many things, it’s best to think about ramifications if the world knew about what transgressions you commit. Because, that’s potentially but a few clicks away.
- Don’t waste time on Mr. or Miss Wrong. Easier said than done, I realize Of course, many of us have seen people spend inordinate time when young dating or chasing the wrong person. I heard a story of a friend of friend who turned down a massive job offer in order to stay with someone who was dating. Who, of course, kicked him to the curb within 2 weeks. Ouch! Big money and career opportunity gone in a flash.
- Build your network. Don’t burn bridges, build them instead. The world is getting smaller, so it’s more important than ever to be a giver and think proactively with your network.