Measure twice, cut once

March 12, 2008 at 9:10 am 1 comment

I came across a blog this morning run by a twenty-something soon-to-be-graduated college student. He wrote a great post on what he currently does with his money and outlines some of his post-graduation plans. It’s rare to come across a 20-year old who thinks about money management let alone investing. He asked for some suggestions and advice on how he could do things differently, so I offered a few suggestions. I thought this might help someone else, that’s why I’m posting my recommendations here.

Question:
Help!?!?!
I am very open to any suggestions. I’m a 22 year-old who was raised to be pretty horrible with money. Any advice? Anything you see wrong with what I’m doing?

My response:
Since you asked for suggestions, I’ll make just a few. The most important thing is that you actually think about managing your money. Most 20 year olds could give a flip, so kudos to you.

Set Goals
My first suggestion would be to sit down and decide what your goals are. Write down short term and long term goals in regard to your finances. It’s never too late to start thinking about retirement, but it’s never too early to get out of debt. Once you figure out what your goals are you can start developing a plan of action to make sure you reach them.

Plan
My second suggestion is to devise a plan. If you want to get out of debt, then you need to figure out how that’s going to happen. You mentioned a couple of books you’d like to read and both are excellent suggestions. I highly recommend the Dave Ramsey book because he offers one of the best get-out-of-debt plans around. Some argue about the numbers but in the end, no one can argue with the results. And that’s exactly what his plan delivers.

Thirdly, determine your retirement aspirations. Do you want to retire early, maybe 45 or 50? Or are you willing to wait until you’re 59 1/2 or 65? Understanding this will help you devise a course of action to take in terms of your investment opportunities. Also, do you want to do single stocks, mutual funds, annuities, bonds, cd’s, or even real estate. These are all feasible investments but not all will help you meet your goals. Some are more risky than others, like single stocks.

These are just a few of the things that came to mind as I thought about your question. Hope that helps and good luck.

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Entry filed under: Blogs, Debt, Retirement, Saving and Investing, Soap Box.

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1 Comment Add your own

  • 1. Adam Lehman  |  September 30, 2008 at 10:19 pm

    thanks for the link!

    Reply

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