The best financial advice you ever had

[Linney]

Best advice that I got was from a work colleague who was able to clearly articulate the value of a 401k (they were fairly new at the time) and how important it was for young employees to invest in equities. I went to the personnel department and modified my 401k contribution that week. That was about 20 years ago.

 

[clifp]

Don't laugh but for me it is from a tacky tourist T-Shirt
Kimo's Hawaiian Rules

The best things in life aren't things

There are 2 ways to be rich; make more or desire less

He who dies with the most toys-- Still dies

 

[Empty Pockets]

When I was 17 I asked an extremetly wealthy man in our community if he could offer any advice. He said "Invest in equities in your youth".

There was another man who made a lot of money but was always complaining how broke he was. I asked him if he was 17 again, what would he do different. He said "I would have invested in equities in my youth".

I followed the advice of both of them.

 

[yakers]

I have to agree. That book more than any other really opened my eyes, even though I was saving and investing before I read it 4 years ago or so. And I certinaly don't follow the rules in the book to the letter. I don't invest every cent I have into Treasury bills. Money is just something to exchange. You can exchange it for things, or you can use it to free yourself from what eats up your time: work. Last year my money made more than I did. It was like a third income (Wife's, mine, and the money's) that was doing its part to let us not work ourselves to death and hopefully someday in the next 15 years, stop working for just more money.

IMHO, YMOYL is one of the best financial book ever for inspiration, just the realization that I am spending my energy/time on 'things' that may not be worth it. BUT, the financial advice is terrible, do not listen to that part, Treasuries should at best be a small part of a portfolio.

 

[My Dream]

When I was 17 I asked an extremetly wealthy man in our community if he could offer any advice. He said "Invest in equities in your youth".

There was another man who made a lot of money but was always complaining how broke he was. I asked him if he was 17 again, what would he do different. He said "I would have invested in equities in my youth".

I followed the advice of both of them.

Can I ask what some may be considered a no brainer? What is considered Equities?

 

[HelpMeRhonda]

Mine was far less advice, far more experience... Like many growing up #$## poor, with nothing around others, who had far more, can be humbling and motivating.

I watched my parents, who were incredible community oriented people struggle everyday to make it (and ultimately they never really did before my father passed away).

In the sixties my father spent $5000 to build a baseball diamond for our town. He then bought bats and gloves for any kid who couldn't afford one. All the while, we had absolutely nothing. My mother and he would argue about his spending on this stuff while we struggled to make it. And ultimately, my mother had an equally big heart and would give in.

They were my heros. I wanted to be just like them, only not live with such financial hardship. Very motivating to LBYM, save and be charitable, give back to help those less fortunate.

 

[flipstress]

Can I ask what some may be considered a no brainer? What is considered Equities?

Equities are stocks, representing shares of ownership in the company that issued the stock so that the purchaser shares in profits (and losses)
as distinguished from
debt instruments like bonds, where the purchaser is lending the money to the issuing organization and receiving interest for the loan.

Edited to add: Equities give us the opportunity to get bigger returns because we share in the profits, but they can also cause us pain because we share in the risk of loss, too. Debt instruments pay us a fixed rate of interest so there's a certain amount we get. The promise of interest can also be broken if the issuer becomes bankrupt or unable to pay its obligations.

 

[My Dream]

Thanks for the excellent explanation flipstress . 8)

 

[newyorklady]

1. lbym
2. invest in the stock market
3. marry well

 

[P.S.]

...was the example set by LBYM parents

who taught us to:
1. get your education
2. before you buy something- save twice the cost, put away 50% and then you can go buy what you want.

The beauty of this is that by the time you've saved the money, the urge to buy is often gone.

 

[Lambda]

The first: LBYM / "Live like a college student for as long as possible."

The second wasn't advice, but was a school assignment in a high school computer programming class. We had to write three programs. The first was to compute and print out a mortgage amortization schedule for X number of years and at y% interest. The second was a program to compute the minimum payment needed to pay off a credit card at X% interest. And the third was to compute how long it would take to earn one million dollars in X number of years and at Y% interest. It would probably only take a few minutes to write all three in a spreadsheet, but programming them and then playing with the numbers myself really drove the lesson home about which side of an interest bearing account I would rather be on. It also put the idea in my head that earning one million dollars was possible. The teacher himself wasn't a very good programmer, but that particular assignment stuck with me.

The third wasn't advice either; it was almost the antithesis of advice. I watched family members and the families of friends fight credit card companies, debt, and bankruptcy. Even as they fought, they would continue doing with the same bad things that put them in the financial hardship they were in. I vowed that I would work as hard as possible to avoid those situations in my own life.

 

[rs0460a]

A quote that I read in the newspaper many years ago. I cut it out, and it's still on my desk:

Do not pray for what you desire - pray to loose the desire; People who are subject to impules and feel they must act on them may be free to act but they also are shackled to their desires - Gandhi

I guess that's what LBYM is all about...

- Ron

 

[riskadverse]

The first principle of investing is to not lose your principal.

 

[citrine]

The best advice that I have received has been from my Dad:

1) Always buy a car with cash and keep it for as long as it will run.
2) Pay yourself first.
3) Always pay off your credit card.

Another couple of things life has shown me:

1) Don't date a financial mess.....talk about money in your relationships, and if they have a lot of debt and try to justify their debt rather than clean it up....RUN AS FAST AS YOU CAN.
2) Try not to have kids...or if you do....make sure you don't raise brats.
3) Make damn sure that you marry someone who will match your goals and priorities in life and stay married!

 

[spncity]

The best advice I ever had was from my mom about two years after I got married. DH was graduating from school and getting his first job. I'd just gotten promoted at work. She advised us to:

"Live on one income and save the other one."

Unfortunately, we did not take her advice

spncity

 

[haha]

2) Try not to have kids...or if you do....make sure you don't raise brats.

Unusual advice from a parent. I guess this board disproves the whole evolutionary biology/Richard Dawkins Selfish Gene thesis.

Turns out that the purpose of life is not life; it is leisure.

Ha

 

[citrine]

Actually Ha...that is something that life has taught me.
I once dated a divorced man with two children who were absolutely bratty.....he was also the one with horrible debt and credit.....the quick fix for everything was to buy the children something.

I don't know.....my family came here in 1985 from India and my parents couldn't really afford much.....there was more emphasis on quality of experience rather than quantity.....we didn't have that many toys or frivolties. If we wanted something, we had to save and my parents would match half (depending on the object).

 

[My Dream]

Another couple of things life has shown me:

2) Try not to have kids...or if you do....make sure you don't raise brats.

That one surprises me, as for the brats, I'm sure at one point in our lives most of us have been there untill the attitude adjustment came in.

 

[Eagle43]

My sage is named Warren. Quote

"Most investors, both institutional and individual, will find that the best way to own common stocks is through an index fund that charges minimal fees."

Warren Buffet, Letter to Shareholders, Berkshire Hathaway Annual Report, 1997

and...

"By investing in an index fund, the know-nothing investor can actually out-perform most investment professionals. Paradoxically, when 'dumb' money acknowledges its limitations, it ceases to be dumb."

Warren Buffett, Letter to Shareholders, Berkshire Hathaway Annual Report, 1993
Unquote
After I retired, when I could get my hands on the 401K, I moved it all into Index Funds. Warren knows best.

 

[DRiP Guy]

A quote that I read in the newspaper many years ago. I cut it out, and it's still on my desk:

Do not pray for what you desire - pray to loose the desire; People who are subject to impules and feel they must act on them may be free to act but they also are shackled to their desires - Gandhi

I guess that's what LBYM is all about...

- Ron

This is close cousin to a principle I learned a long time ago, but forget the citation for:

"That which you cannot leave is not a possession; you are it's."

 

[kumquat]

2) Try not to have kids...or if you do....make sure you don't raise brats.

Don't we have a poster name BRAT. What does he/she think of your advice? I like it.

 

[Tracker]

(1) Taking care of your health is the best financial investment you will ever make

(2) If at all possible, take out a 15 year mortgage instead of 30 year

(3) Sign up immediately for your company's 401(k) plan

 

[wstu32]

My fathers famous words:



Pay yourself first!!!!


(may fcs jr rest in the peace of God's presence... and thanks!)

 

[cpolashenski]

My parents didn't have a lot of money, Mom didn't work and there were 5 kids so I go a job as soon as I could. It wasn't financial advice per se but the best motivation for me was working at a McDonald's starting at age 15. Knowing the people that worked there 20+ years motivated me all through college.

 

[spideyrdpd]

Buy real estate
The biggest problem with good advice is we all thought we knew better when we were young. The sooner you start the better.