Best Advice To The Young People

**Ebbie** · 06-12-2008, 02:53 PM

On every frugal and money forum I belong to, it seems like most everyone is trying to "fix" their past mistakes. To recover from debt they've incurred, or to stretch their income to cover expenses they can't really afford. I think we've ALL been there, to one degree or another. Personally, I think most people starting out are just on "auto-pilot", not really thinking very much about financial stuff and without a conscious effort most often the decisions made are the wrong ones.

I would love it if I could just somehow magically inject the RIGHT information into the brains of the young people I know. It just seems to me so much effort is spent FIXING finances and the young folks would be so much better off if they could just get off on the right foot instead and avoid the mistakes and the years lost fixing them.

So, in that vein, post your most prophetic financial advice. If there is one thing you could convey to any young person just starting out, who's made no major mistakes yet, what advice would you give?

For me it's....

Always have an emergency cushion!

Always, always, always. Even if you're just a college student. Aim for a minimum of 3 months living expenses, better if it's 6 or more. As your living expenses go up, so too increase your emergency fund. NEVER live without one, no matter what stage you are at. No one goes though life without experiencing unexpected circumstances. NO ONE. To think you'll be the exception is foolish and to live without an emergency fund is financial suicide.

Ahhh...thank you...I feel so much better getting that off my chest! LOL!

What financial advice would you give to the young and not-messed-up-yet?

**pecunierrant** · 06-12-2008, 02:56 PM

My advice would be -

Do not take on debt. If you can go through life paying cash for everything you will have so much less stress and have a much higher chance of coming out ahead.

**Russ** · 06-12-2008, 03:01 PM

Originally Posted by pecunierrant

My advice would be -

Do not take on debt. If you can go through life paying cash for everything you will have so much less stress and have a much higher chance of coming out ahead.

"If" being the operative word. Most young people graduating college are probably starting out in the hole, top that off with a mortgage.
I think a better saying would be to take on as little as possible.

**Darlene** · 06-12-2008, 03:04 PM

Live below your means. You may want "it" but chances are you don't need "it". Find ways to make do and have fun doing it. Save all you can, start building for your retirement asap. Don't put it off.

**jean08** · 06-12-2008, 03:08 PM

Ditto to everything above.

Start your 401K as soon as you get a job and never, ever touch it until retirement.

**Greebo** · 06-12-2008, 03:09 PM

pecunierrant said it first a bit differently, but I'll repeat it:

DO NOT SPEND MONEY YOU DO NOT HAVE

Ok, so maybe you have a student loan. That's all you should have. That's MORE than you should have, quite honestly.

You do not need the new couch, new tv, new anything, and if you can't pay cash for it, YOU CANT AFFORD IT.

You do not need the NEW car - the beater for $1,000 will get you to work. SAVE until you can pay cash. If you have to finance a car, YOU CAN'T AFFORD IT.

If you want to buy a home, and you can't put AT LEAST 20% down, YOU CAN'T AFFORD IT. If you can't get and/or handle the payments on a fixed, 15 year mortgage, YOU CAN'T AFFORD IT.

Remember, your parents probably worked and saved their whole lives to live the lifestyle they did when you were growing up. If you try and have it all before you can pay cash for it, you will never live the same lifestyle. (Or your parents didn't work and save, and you'll end up living the same stressed out, broke, depressed lifestyle they did.)

You can work for your money, or your money can work for you. The choice is yours.

Ok - off my soapbox and done

**pecunierrant** · 06-12-2008, 03:46 PM

This is true, but our eldest is going to college without incurring any debt with scholarships, grants and a part time job. Thing is we made this point to our kids that doing it this way, staying out of debt was THE way to go long before they got to college age.

This was the advice we give our kids

Originally Posted by rcannon

"If" being the operative word. Most young people graduating college are probably starting out in the hole, top that off with a mortgage.
I think a better saying would be to take on as little as possible.

**cab54** · 06-12-2008, 04:01 PM

I would say to young people--IGNORE ADVERTISING.

They want you to believe you're not perfect enough, haven't got the latest toys, would be more beautiful with THEIR product. That there's something wrong with you if you don't drive this car, or eat that cereal, or wear the latest fashions, or buy that toy for your kid.

A LOT of things ARE advertising that don't ACT like advertising, like TV shows, and magazines. Even if they don't have an ad in them, they usually are 'touting' something in their articles. Like a way of life---that costs a lot. YOu may think because all your favorite characters on a show do THIS or buy THAT, that it is just normal. Challenge what is normal. Is it normal to buy an expensive coffee at Starbucks when you can make coffee at home for pennies? Do you HAVE to wear those kind of pants because everybody is wearing them. You probably don't eve LIKE them, you just want to have 'what they're having'.

Not important in the big picture, let me tell you.

**luv-my-lexi** · 06-12-2008, 04:12 PM

Just wait for all those "wants". Save up the money to get them don't just get "instant gratification" by using credit cards. Also, pay yourself first as in "some sort of savings accout" that you always put money into just as if you are paying a bill.

**Bournecrazy** · 06-12-2008, 04:51 PM

just be one step ahead of your self, save for an item in cash, then buy it, start an EF. with how prices are going lately we dont know what will happen so start saving ASAP

like me ive only just started getting an EF together got house savings and other savings.

Dont listen to the TV/ Magazines/ Advertising boards they lie, the product is either not that good/ will not make you feel great

**Bournecrazy** · 06-12-2008, 04:55 PM

oh NEVER get a CC if yuo can live buy cash there is not point in getting a CC

**MysticEagle** · 06-12-2008, 06:28 PM

Start saving 15-20% of your income and continue to do so as your pay increases.

**Katybird** · 06-12-2008, 06:52 PM

I think it is important for everyone, young and old alike, to have an emergency fund set up. You never know what type of emergency will pop up and being prepared is so important.

**Ilovesewing** · 06-12-2008, 07:02 PM

The two things I've always told my kids as they grew up (they are 20 and 22 now) is never ever ever have credit cards; and start your 401K or IRA as soon as you start working. They are both doing well in the credit card area, but gee whiz, getting them to let go some of their earnings for the retirement that is 50 years down the road is not going well!

**C@rol** · 06-12-2008, 07:06 PM

Start reading financial investment and money
management books as soon as possible.
It's not taught in the schools or colleges so it's
something you have to pursue yourself.

Find out who Dave Ramsey and Suzy Orman are.
Read the Tightwad Gazette. These all will put
you so far ahead in your financial life.

Make your motto: "Pay yourself first!".