What would you tell your 22 year old self?

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FearTheTaxMan

Confused about dryer sheets
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Go back in the time machine for those older members. What would you tell your 22 year old self? Knowing what you know now.
 
It doesn't matter. I wouldn't have listened to myself. Most of us at 22 think we already know everything, so there is no need to listen.
 
OP, I assume you are asking about financial-related advice.

I would advise my 22-YO self to wait another year (until age 26) before buying an apartment because you would have more money saved up and be able to afford a one-bedroom at lower interest rates.

Otherwise..........stay the course with finaicial decisions because they will lead to an early retirement in 23 years. And on 9/11/2001, go back home as soon as you can so you don't get stranded in New Jersey overnight.
 
Make hay while the sun shines.

If things are going well, take advantage of the opportunity to put some extra away for the inevitable rainy day that will follow. Don't squander opportunities to advance long term interests (like investing) just because there's apparent excess in the budget that could afford some extra toys.

I suppose people can take this too far, so if your 22 year old self is such a person, caution not to overdo it, and enjoy life and collect great experiences while you are young. My 22 year old self was sure to do that regardless of any advice from me.
 
I would tell him, first of all, to stop wearing that ugly army jacket around campus. Without it he would probably get lucky a lot more often.

Second of all, I would somehow try to show him that economics is absolutely central to his long-term happiness. I would tell him that, despite the fairly tales he's heard, happiness is very hard won. At times he will have to pry it from the clenched fingers of people and institutions that will try to keep it from him.

In short, I would tell him to prepare for a titanic battle, but one that is winnable, and worth winning.

Chance that my 22-year-old self would heed this: 2% or less. :(
 
I would tell my 22 years old to save as much as possible and live with a roommate or your parent, if possible.

Because when you're 40, you're going to be sick of the working world and job titles and compensation won't make any difference.

Just trying to surviving 5 more years and be FI and get out of this rat race.
The goal of getting to the top when you're 22 doesn't matter to you when you're 40. At 40...you just hope you don't die on the job like your other co-workers iheir 40's and 50's :(
 
comicbookgujy said:
I would tell my 22 years old to save as much as possible and live with a roommate or your parent, if possible.
Click to expand...

+1

As I mentioned in your other thread, slash every cost you can (while not being crazy about it). I lived with my parents until age 32. Sure, it wasn't the easiest thing to mention to prospective women - but the type of woman I was looking for would understand my motivation for living at home as being pure financial. In fact, I dated 2 women who were also living at home at the time, also for purely financial reasons.

Living at home can help sock away $7,200/year (minimum). And that's after-taxes.

Also, learn about the tax code as you get older and your income grows. For instance, you should study up on the health insurance policies available to you.

In my case, I have very cheap individual health insurance with a High Deductible, and I qualify for a Health Savings Account. It's like an IRA except for medical expenses, and I get to roll over unused funds year after year in my own account that I own. For every $1 you put into an HSA, you reduce your taxable income by $1, AND the earnings will grow tax-free as long as you use the funds for healthcare expenses. If you don't use them up, you can simply withdraw them at age 65 or 67 and pay income taxes on it like an IRA.

The great thing is that - depending on your health insurance policy rates - the tax write off can pay for it. For instance, I max my HSA each year - about $3,200 contribution, which gives me about a $1,000 savings in income taxes. My current health insurance policy only costs me $650/year, so my HSA tax deduction pays me $400/year for my high deductible plan! Of course, my deductible of $5,500 means I pay for the first $5,500 in health expenses each year if I get sick, but I'm very healthy, and odds are I won't have any significant expenses for quite a while. By the time I do, all of those years of contributions will be more than enough to pay for anything.

But don't forget that you can be on your parent's health insurance plan up until (I think) age 25 or 26 for free. See if you can qualify for that.

Also, in your income tax rate, learn about the Saver's Credit. It gives you an additional income tax credit if you save in a 401k or IRA and your taxable income is low.
Saver

It may not be huge, but getting an extra, say, $350 in your pocket from the saver's credit, and a few hundred $ in your pocket from an HSA account tax deduction, coupled with living at home and slashing other expenses can really snowball into huge increases in your investment portfolio in just 10 years!

And another thing - don't forget to look at the total cost of owning things. Buying a more expensive new car vs a more modest new car is not only more expensive for the sticker price, but then you most likely will pay more for insurance, property taxes, and possibly even after-market parts (like speed-rated tires, etc.). Just so complete strangers on the road whom you are next to for 10 seconds and whom you will never see again are impressed by your Mustang or some other hot rod.

If you have $3MM in your portfolio and can easily afford to drop $50k on a sports car, then go do it. But burning up the cash in your 20s/30s will make it forever disappear, and it will never have a chance to give you economic freedom when you're in your 40s and 50s that everyone else can only dream about if they hit the lottery.

Don't be afraid to buy used furniture and other items on Craigslist (but by all means, wipe any furniture down with a bleach or other cleaning solution that won't stain or damage it). It's crazy what new DISPOSABLE furniture costs in the store - even at WalMart! Compare that to much cheaper and halfway decent furniture that's 20-60+ years old (back when furniture wasn't disposable) and will last you another 10-30 years with decent care. I spent perhaps $3,500 on furniture between Craigslist and a discount furniture store and a warehouse clearance sale to outfit my 1,700 sq ft house with 2 bedroom sets, an office, and dining room/living/family room furniture....and that's including $1,400 for my new master bedroom set from a furniture store (I could have spent $1,000 less if I searched longer on CL for a used master bedroom set). $3,500 is less than many spend on just a single bedroom set, much less an entire house!
 
Investing in skills when you are young and learn as much as possible even at the risk of looking dumb. Salary early on is not as important as salary later on.
 
Keep doing most of what you are doing, just try to save a little more - all the naysayers will be proven wrong 30 years from now. :)
 
Find something that you enjoy and work hard to be good at it

Act as an employee as if you were an owner - give a care and take a long view

For the first 10 years of your career, experience is more important than pay - take jobs that give you good experience as long as you are fairly paid

Save regularly and invest in no-load, low cost, index mutual funds.

Live below your means but an occasional splurge is ok, you deserve it.

Relationships are important

Have fun
 
I would tell him to spend more time with your parents.

Cheers!
 
Read Your Money or Your Life and The Millionaire Next Door.

Get interested in a sustainable living / low consumption lifestyle early on. It saves money and is better for the planet.

Don't have any hobbies that involve collectables or collections.

Don't live where you get the highest salary, live some place you enjoy and where the salary to housing prices are favorable.

Buy as small a house as you can comfortably live in. Bigger houses cost more to heat, cool, repair, insure, pay taxes on, furnish, etc. and often inversely related to wealth accumulation.

If you have a house, lose the front lawn and back lawn if you don't have kids that need a place to play. Put in native plants, walkways, an edible garden, permaculture design, etc.

Try to get a career & develop income streams that are location independent that allow you to live anywhere in the world.

Put a high priority on reaching financial independence.

Invest in your human capital. Keep learning and studying. Keep your savings high, your expenses low and develop rare and valuable skills so that you are highly marketable. Have a job that you enjoy so it doesn't seem like work. Don't be the person with a huge mortgage, kids, and a a nonworking spouse trapped in a high paying corporate job that you hate that can't be easily replaced if you got laid off.

Don't watch a lot of TV. It is a time suck. You can spend the time other people spend watching TV (4 hours a day?) on a hobby business or furthering your education.

Live below your means in a neighborhood where you are the Joneses instead of trying to keep up with them.
 
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My 22 year old self already had lots of people telling him what to do. Mostly bad advice and distractions. I would just remind him that there is not one single path to any destination, his own inner voice and his DW's were the only ones that would stick around over the years and enjoy (or suffer) the consequences, so they mattered more than anything or anyone else. And to never forget to nurture the marriage. :)
 
As a variation on what MichaelB just said, I'd tell any 22 year-old not to blindly accept common wisdom. My younger self did just that (as well as ignoring a lot of the good advice too!)

We all have to follow our own path and discover things for ourselves.

P.S. FearTheTaxMan - you only have 6 posts under your belt and are already castigating other members? If you read Larro Darro's comment again, you may see that it is a perfectly valid comment. Welcome to the forum - we try to be kind to each other here. Well - for the most part :D
 
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comicbookgujy said:
I would tell my 22 years old to save as much as possible and live with a roommate or your parent, if possible.

Because when you're 40, you're going to be sick of the working world and job titles and compensation won't make any difference.

Just trying to surviving 5 more years and be FI and get out of this rat race.
The goal of getting to the top when you're 22 doesn't matter to you when you're 40. At 40...you just hope you don't die on the job like your other co-workers iheir 40's and 50's :(
Click to expand...

Exactly. Comicbookguy, I hope you can make it in 5 years. I'm not myself going to retire in 5 years, but 5 more years from now, I'll have my 20 years in. At that point, I'm going to do something else I'll like.
 
FearTheTaxMan said:
Go back in the time machine for those older members. What would you tell your 22 year old self? Knowing what you know now.
Click to expand...
"Live below your means"
I didn't actually start doing that till I was about 29.
 
There is a really good novel by Ken Grimwood called Replay that basically covers this question. The main character dies at 43 and wakes up in his college dorm room at 18, confused, but fully remembering his life. He has a chance to relive his life, make a fortune betting on sports events he knows the outcome of and picking stocks that will take off, trying to avoid or fix relationship issues, and so on. He dies again at 43, and repeats the cycle continuously, coming back a bit older each time. As you can guess, it doesn't all go smoothly. It was written in the 80s but its not hard to imagine in any time frame.
Replay: Ken Grimwood: 9780688161125: Amazon.com: Books
 
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