
Ask HN: What personal finance advice would you give your 25yo self ? - zabana
Or if you could go back in time, what would you have done differently, what lessons have you learned ?
======
baccredited
\- credit card debt is an emergency and optimizing any other money stuff while
you carry it is like rearranging your sock drawer while your house is on fire

\- save 25x your annual spending and never work again

\- start by saving at least something (even 1%) and save 50% of all future
raises

\- long commutes are for fools. So are new cars--buy used.

\- spend on things that you value. I've given myself a tech budget for years
because good tools matter to me

\- host a dinner party instead of eating out (most of the time)

\- If you have a gamblers mindset to investing, carve out a small portion
(10%?) of your money and use it for risky investing. I call mine the 'casino
fund'. Track your returns.

\- read voraciously about finance and early retirement. You only need about 20
books or so to gain a background that is easily more valuable than your
college degree. This is a good start:
[https://www.reddit.com/r/financialindependence/wiki/books](https://www.reddit.com/r/financialindependence/wiki/books)

~~~
k2xl
Agree generally with these points except for the buying used cars.

Buying new, inexpensive cars are a much better investment if you plan on
owning them for a long time.

Used cars don't last as long, and they carry more risk. The amount of money
spent on repairs can be unpredictable.

~~~
theandrewbailey
I've heard cars sold by rental car companies are like new, but cost about half
as much.

~~~
noxxten
Rental cars are hit or miss. You either end up with the one that didn't get
much use outside the average business trip... Or the car that was abused. My
last car was an ex-rental car, and it deteriorated very quickly after I signed
the loan for it. Be careful.

------
damagednoob
Don't leave disposable income hanging around as savings in a no/low interest
bank account. Invest it in an index fund with low fees (Vanguard, etc.) or
better yet, figure out an asset allocation and invest in a few accumulating
funds.

A good piece of advice I picked up from Rami Sethi (when it was still
worthwhile reading his blog) was think about how much of your free time per
month do you spend on various activities (Facebook, Gaming, etc). How much of
that free time is devoted to thinking about your personal finance? If it's
less than you think you should be doing, schedule it in.

Also starting reading
[https://www.reddit.com/r/personalfinance/](https://www.reddit.com/r/personalfinance/)
regularly.

~~~
jazzyk
I disagree with your statement about not having savings in a safe (usually
lower-yield) account.

Index funds are usually a good idea in the long term, but right now (June
2017), I would not put a penny in the stock market - it is ridiculously
overpriced.

~~~
UK-AL
People were saying that 3-4 years ago, and its gone up. Your trying to time
the market.

~~~
JauntTrooper
January 2011 article: "Stock Markets are 'Overpriced': Robert Shiller"
[http://www.cnbc.com/id/41288407](http://www.cnbc.com/id/41288407)

Stock markets in the developed world have risen too much, Robert Shiller,
economics professor at Yale, told CNBC Thursday.

On Wednesday, the Dow bounced above and below the psychologically-important
12,000 for much of the session. But stocks look expensive, Shiller said.

"I would say the market is overpriced based on fundamentals … I'm talking
about the US and probably Europe," he said.

[The market has almost doubled since then.]

~~~
UK-AL
Exactly my point. Everybody was saying they were overvalued, and were about to
crash. Yet they went even higher and still going higher almost 7 years later.

Thus you can't time the market.

Don't trust experts telling you to enter and exit.

~~~
JauntTrooper
Yup, I was agreeing with you. :)

------
truewords
Marry well. What I mean is this:

Your spouse should have a career or should think of having a career of his/her
own. Its not about having a lot of money, its to eventually have someone as a
financial backup in case things go wrong. Works for both partners.

I love my wife but financially I am in trouble. I make enough money but she
has no career aspirations. Her family is quite poor and I had to get mortgage
for a house for her parents. In future I will also need to worry about their
health expenses.

This effectively means I can never get out of the rat race.

~~~
romanovcode
> I had to get mortgage for a house for her parents.

You married your wife or her parents? Why would you do such thing.

~~~
kodt
You don't think children should care for their parents?

~~~
romanovcode
They should. For their parents.

~~~
kodt
I don't think it is fair for the sole earner in a relationship to say "Sorry,
I will only support my own parents, yours are SOL".

Seems to be a very self centered view, and not respectful the relationship he
is in with his wife. When you get married, you take on some responsibility in
caring for members of their extended family as well.

~~~
logfromblammo
Conversely, it is not fair for someone who needs to support their parents to
expect their spouse to carry the entire burden. That is, in that situation,
there should be no sole earner to say such a thing.

~~~
kodt
I agree unless they discussed being a sole earner household and agreed it is
what they wanted (usually because they want one parent to stay home and raise
children). If they have no children, or no immediate plans to have children,
then I would agree they should both be working.

~~~
logfromblammo
Given the social climate in the US, if there are no children or plans for
children, that removes about 80% of the incentive for getting married.

And I certainly don't think that anyone from a younger generation should be
buying anyone from an older generation an entire house. The parents or
parents-in-law can have a bedroom, pay you rent for it, and as long as they're
living under your roof, they can live by your rules. Isn't that what they told
you when you turned 18 and you couldn't afford your own house?

------
dtnewman
I'm only 30, so it's not like 25 was particularly long ago for me. But since
then, I've gotten married, which is a major life change (overall for the
better for me!).

But if I could go back to age 25, before I was married, I'd have told myself
to travel to more far-flung places. Being married, I have to:

A) Agree with my wife on where we want to travel

B) Have time to travel that works for both of our schedules (which is
difficult to find... plus we have to spend at least some of our time off going
to visit our respective families, and now I have two families to visit instead
of one)

C) Have the money to travel. In our case, we have two incomes, but still, it
was much cheaper when I'd travel with friends and cram four people into a
cheap hotel room.

I'm not complaining here. I'm fortunate to have spare income that let's me
travel quite a bit with my wife and it's really a fantastic experience to
travel with your partner. But there are trade-offs that I simply didn't have
as a 25 year old. So those places that are far away and hard to get to? See
them while you're young.

------
BIackSwan
Travel as much as you can. It will get harder to find opportunities to do so
as the years go by and responsibilities increase.

~~~
rimliu
Travel does not necessarily appeal to all.

~~~
nkozyra
But it does to OP's 25-year old self.

------
saryant
Have enough in savings to walk away whenever you want. I've been stuck in jobs
far longer than I wanted because I'd neglected my emergency fund and didn't
have the cash on hand to walk away.

Now I make sure I have a year's living expenses available outside of my
investments. If I get tired of my job, I can just quit knowing that I have the
cash to float myself for a while.

A year may be more than you need but at least six months is a good minimum.
You'll have the cash to cover a job loss, car troubles, most medical expenses,
etc. on hand without going into debt. And an emergency fund should be liquid
and save, not invested and at risk. You may only get 1% in a savings account
but view the low returns as the cost of insurance, since that's effectively
what an emergency fund is—self-insurance.

------
Murkin
People.

Meet and keep in touch with as many people as possible. Switch jobs, travel
the world, volunteer and always _always_ make new connections.

The best financial (and personal) gains you will make in life will come from
the right connections.

~~~
_e
Surround yourself with people who like to learn through experience.

Experiences will turn into knowledge which could possibly turn into
opportunities.

------
m-i-l
I reckon I got most things right, but as this is specifically "what would you
have done differently, what lessons have you learned?" the big one for me is:
don't invest in individual stocks, invest in broad (ideally low fee, e.g.
passively managed) funds instead. Growing up in an era of privatisation,
reading the financial press with all their information on individual
companies, seeing all the stock market pundits with their various stock picks,
and so on, buying individual stocks just seemed to be "the thing to do". But
at the end of the day, unless you spend an enormous amount of time on it, you
are very unlikely to be able to out-perform the market. In my case there were
many bad investments I could arguably have avoided, e.g. all the dot com
stocks I bought on 15 March 2000 and banking stocks I bought on 25 April 2008.
But I did buy a lot of BP shares on 15 April 2010 (5 days before the Deepwater
Horizon explosion), and I don't think any expert could have foreseen that.
Individual stocks are far more of a gamble than funds.

~~~
dbatten
Let's be honest... research shows that even if you are a trained professional
making a career of picking stocks, you STILL probably won't out-perform the
market.

~~~
nojvek
I've heard that a lot. Put it on S&P 500. No hedge fund will be able to beat
that.

Consider the fact that S&P 500 is made up of 500 companies, there will be a
top 100 and a bottom 400. There are some sectors that grow better than others.
e.g For the past couple of years the entire Tech sector has done phenomenally
well.

I like picking stocks, learning about companies, their products, competition,
reading financial statements, P/E ratios and speculating. Its fun!

It does feel like a gamble at times so I do a 50%/50% split. Half goes to a
wide index, and the other 50% is split into smaller chunks that goes to stocks
I have picked after a lot of reading and thought.

For the past 3 years I've beat the market but 3 years is a very small sample
so I may as well very much lying to myself. In anycase I enjoy it.

~~~
thatwebdude
Individual stocks, to me, is like gambling. With enough knowledge and
foresight and luck you can really make a pretty penny.

I like the idea of also investing in funds. AI and professionals are already
watching and picking these for you; it feels like investing as well, may have
lower returns but typically much safer.

A mix of both seems very healthy and what a lot of able-bodies are doing right
now.

------
damassively
I'm not 25 yet but this is my (current) course:

1\. Reduce all bills/belongings to bare essentials to live minimally.

2\. Pay off all debt while maintaining $1,500 emergency fund.

3\. Save 6 months living expenses.

4\. Invest in yourself with excellent groceries, gym membership/local park
visits, medical/hygiene care and other healthy habits.

5\. Invest in Vanguard's Total US Stock, Total International Stock and Total
Bond ETFs (% as age) and don't touch it.

6\. Invest in building your own business - tech or otherwise.

~~~
stevenmays
$1500 emergency fund is LIGHT. It should at least be 3 months bare minimum
living expenses. $1500 wont even cover a lot of people's rent/mortgage bill
for one month.

~~~
peruvian
Did you read his next point? Emergency fund is for when your car breaks and
you have to take money out of savings to fix it.

~~~
thatwebdude
When an emergency fund and X-months living expenses are compounded I really
don't see the use of an emergency fund. Assuming someone has good enough
credit to be able to borrow for short-term fixes in times of need.

------
sametmax
I travelled a lot and figured out very soon I should never ever contract dept
or have a strong commitment (house, children, etc) too soon. I'm still amazed
so many people regret doing that, being young don't mean being dumb, why did
you do that?

Anyway, my advice would be:

Start meditation sooner.

I would give myself many other advices about risks, people and self-
acceptance, but I would have not being able to listen to them at that time.

That's the problem with advices, you must be in a place in your life where you
can actually use them.

But I would be able to meditate and figure it out, since that's how it
happened.

Replace that with any tool that helped you develop yourself.

If you don't have such a tool, find one quickly that suit you.

Oh, and yes, travelling help, so do so. But you'll reach a limit in what it
brings to the table. You need to find a better tool on the long run. Just like
money helps, but has a max amount after which it won't make you happier.

~~~
thatwebdude
That's good for you, some people shouldn't have those kinds of commitments. It
certainly doesn't mean they're being "young and dumb" though.

------
logfromblammo
First, don't get married.

If you can manage to get that one done, you can actually act on the rest of
the financial advice in this thread. If not, you will have to be in unanimous
agreement to do anything wise with money (i.e. keep emergency fund, plus six
months living expenses in liquid savings), whereas foolishness may be
undertaken unilaterally.

~~~
J-dawg
This seems like rather bleak advice but it is a very good point. It can create
so much tension if you're not 100% on the same page financially.

Also, if you plan to have kids and are likely to be both the higher earner and
not the primary child carer, the potential downsides of marriage are enormous.

~~~
logfromblammo
My spouse seems entirely incapable of keeping savings, so the rational
financial advice I would give myself is to get divorced, so that I can lose
only up to 50% of what I earn, rather than 100% of it. It doesn't help that I
don't seem to be getting anything else out of the deal any more.

It would have been a whole lot easier to just not get married in the first
place. If you can't stand being single, at the very least, make the other
person's debt situation a deal-breaker before getting too involved with them.

------
bluedino
Do not go out and buy <sports car> and proceed to spend <stupid amount> of
money on it trying to make it cool/fast when you are 22. And then immediately
after that do it again with another car. You could almost buy a house.

~~~
spydum
Disagree on this one. I learned a ton working on my car as a kid. Though maybe
we have differing values for <stupid amount>..

~~~
imron
Parent defined it as 2 * <stupid amount> almost = house.

~~~
theandrewbailey
But a house in which market?

~~~
TomMarius
Whatever market you're going to buy a house in

------
switch007
Eat out less (the value for money is extremely poor in the UK)

Contribute more to an index fund.

Save harder for a deposit. High rent/shared housing is horrible.

Don't try to keep up with the Joneses. There'll always be someone richer, with
a nicer car – you can't win that game. You weren't born in to money, don't
even attempt to act like it. Live below your means.

You need to treat yourself far less often than marketing companies would have
you believe.

~~~
thatwebdude
Keeping Up With the Jones' is a concept that doesn't seem highlighted enough.
Especially when you are at a stage in life where you have the financial means
to attempt so.

------
holtalanm
"You dont need to spend $50 on that video game. Or that one. Or that one.
Actually, just give me your wallet, you can have it back in 10 years."

Also, start mining bitcoin.

~~~
d0lph
Disagree, video games are some of the cheapest forms of entertainment per
hour.

~~~
reboog711
Sure, but there are plenty of great games available for less than $50. And if
you can wait a year; you can probably get today's great game for significantly
less than $50...

I know some super financially conscious folks who purposely stay one "Game
system behind". Nintendo Switch is coming out? Buy a Wii U and collect games
for super cheap. Hour of entertainment at a fraction of the cost.

------
pgm8705
Stop going out eating and drinking so much. Don't work for pennies on the
dollar in exchange for equity.

------
jaclaz
In Italy there is (was, as it is not much used anymore) proverb: "Fare i conti
spesso, moderar le voglie, spender men di quel che si raccoglie".

It cannot be translated easily, but more or less it amounts to:

Do the (financial) math often, limit your cravings, spend less than you can
gather.

------
kamaal
I'm a little late to this but this might help you. I'm an Indian, but I assume
you are in the US. Having spent some time in the US this is what I would
advice:

\- Go get yourself a savings account and a checking account. Fill only enough
amount in your checking account that you need to get by the month. Remaining
goes into savings.

\- Buy a home as quickly as you can, in an affordable place in the outskirts.
By the time your kids arrive necessary infrastructure will be in place. Also
rent is just another form of tax. And having your own home also means some
place to rest without financial implication when you are old.

\- Take the 401K plan seriously.

\- Max out other instruments such as the IRA and Roth IRA.

\- Buy a durable, long lasting car. And stick with that as long as it lasts.

\- Healthy life style. Nothing pays as well as good health. Buy a bicycle or
play a sport. Ensure your heart is healthy and you are not obese. There are
other things to this, like learning to cook healthy food. Remember bad health
too will account for a big chunk of your earnings in a place like the US.

\- Be frugal. Frugality means making decisions that pay on the longer run. $5
may buy you burger combo in McD but trust me it will cost you on the longer
run. You don't want that kind of frugality. Which is why the learning how to
cook makes even more sense on the longer run.

\- Be productive, in all ages. Have free time to network and develop new
skills. Never be afraid to start from the beginning or learn and do something
new.

\- Lastly save. Save a lot.

------
bsvalley
Take as many risks as you can now otherwise you'll be maxed out in terms of
income for the rest of your life. You're young and can live for cheap.
Startups, businesses, etc. Don't get trapped in the W2 lifestyle and big
corporates.

~~~
aliston
This is really interesting and good advice. Out of curiosity, would you mind
sharing a bit about what led you to it?

------
matt_s
I think about 25 was when was on the cusp of a series of job moves/promotions
in the next 5 years. I would imagine a lot of 25yo might be in the same spot
(or not - whatever this is my anecdote).

Keep your cost of living the same when you see large pay bumps or raises. This
means the big things like car, house/rental, etc. Don't just go get a new car
and increase your spending or move to a "nicer" apartment or buy a house
because you have the money available. Keep the car, stay in the apartment and
save the extra money.

People will stay that owning a home is an investment - maybe in some areas it
is - but not all. If home values are relatively flat in that area or grow very
slowly then it is a losing proposition. You will be paying property taxes,
school taxes and all the other "taxes" of owning a home: maintenance, repairs,
accumulating "stuff" to fill it, etc. If the growth in that area is slow then
that is all money down the drain - you won't get it back when you sell.

~~~
holtalanm
that is assuming you ever sell the house.

------
randomguy101
Every time you treat yourself, with a fine bottle of wine, or a nice sofa, or
a great suit, you develop your appetite for "nice" things.

The more money you make, the more nice things you acquire, and the harder it
is to imagine living without them. At the furthest reach, it's a private jet--
the crack cocaine of travel.

Develop these appetites with great caution.

------
jansho
Slightly older but I'm learning a hard lesson now: make sure to have at least
6 months worth of savings before going fully self-employed!

------
_Codemonkeyism
Don't spend money on stupid things. You don't need them.

~~~
sotojuan
Can you define "stupid things"?

~~~
_Codemonkeyism
What I've spend too much money on: Tech gadgets, DSLRs, LEGO sets, neat
things, books I don't read, stuff to put on shelves. Especially if you have
too much money. At first you don't think a lot if you need things <$10, when
your income grows so does your "don't-think-spending-limit" to $100, then
$1000.

Not stupid: Books you really read, long term investing, making experiences.

Today I have a monthly "Make-your-live-lighter-day" where I give away/throw
away things.

~~~
artmageddon
This probably doesn't apply to a lot of people, but I got a ton of mileage out
of my DSLR and learned a lot about photography in the process. I mean
unfortunately the one I bought (and still have) from 2009 is pretty dated now,
I wouldn't consider it a waste(unless you count the fact I could've spent
those on bitcoin instead and been a millionaire).

------
msl09
_Scratches his head mumbling_ What kind of financial advice can I give to some
one that has no job...?

Oh yeah, you don't need to save that internship money, I'm good now. Besides,
I make like 5-6 times what you are making.

~~~
solipsism
That's not really in the spirit of the question. If you're going to tell them
that, you may as well tell them which stocks to invest in and who won each
world series.

------
Talyen42
$10,000 saved in your twenties is $200,000-300,000 in your pocket at age 55

~~~
majewsky
That's an interest rate of between 10.5% and 12%. Please sign me up, because I
definitely don't know where to get that.

~~~
DavidMiserak
S&P 500 (SPY) is around 11% over 30 years. I have a retirement app you can
play around with @ DavidMiserak.com/retirement-app

------
woudsma
I'm 25, keeping an eye on this thread..

Best financial decision i've made was to buy some ETH (Ethereum) last year.

~~~
rglullis
Saying it as someone who has been buying BTC since 2012 and ETH for the past
couple of years: buying cryptocurrencies is as good "financial decision" as
buying lottery tickets. Repeat to yourself: even if you made good money, it
was more for lucky timing than anything. Past performance is no guarantee of
future returns.

~~~
woudsma
True, it's a total gamble. Only do it with the money you can spend. Still,
it's a special time for cryptocurrencies
[https://bitcoinfomo.club](https://bitcoinfomo.club)

------
dvko
Read up on finance, learn about assets vs liabilities.

Understand buying vs renting before doing either.

Keep monthly (recurring) expenses low.

If you absolutely need a car, keep your ego in check and look at mileage &
reliability.

Think long term.

~~~
_e
Great points especially keeping monthly (recurring) expenses low. An increase
in income can easily result in an increase in spending.

------
gao8a
\- If a decision comes down to either not having enough time or not having
enough money, rest assure there will never be a sweet-spot where you will have
both.

\- Always take into consideration mental health cost. Your commute, your work,
the people you choose to surround yourself with. Debt in this area is
unpredictable and therefore dangerous in the long run.

\- No one has it figured out. Youth will always be wasted by the youth.

Good luck.

------
herghost
Don't get into consumer credit debt. Not huge figures, but I'd convinced
myself that I would always have debt so I might as well not care about it.
This led to my buying things I didn't really need on credit, whilst just
paying for it monthly, forever.

------
marsrover
Don't move into an apartment that costs 50% of your salary, no matter how nice
it is.

~~~
sotojuan
And if you do, move in with someone who can help out with the rent :-)

------
nunez
make a spreadsheet comparing your earnings to your debts and billables, record
ALL of your debts and STICK TO THE FUCKING SHEET

~~~
DavidMiserak
I find mint.com helpful for exactly this reason.

~~~
nunez
last i checked, mint doesn't do biweekly expenses that well. is it better at
that now?

------
k2xl
A subreddit I highly recommend (depending on your goals)
[http://www.reddit.com/r/financialindependence](http://www.reddit.com/r/financialindependence)

------
howeyc
Don't buy so much stuff, it's mostly junk that'll sit in a box somewhere. When
contemplating a purchase, honestly ask yourself how much use it will get, and
for how long it will be useful.

Rent. Home ownership only starts making sense on a 5+ year time frame, in some
markets 10+ years. Having the ability to move for a better job will reap huge
financial benefits, and moving for a short commute will allow you to have so
much more free time.

Save vigorously, but not so much that you have a dreadful life now, pining for
the future when things will get better once you have "retirement money."

~~~
thatwebdude
Or position yourself in a market that's competitive where you can demand
higher wages and still benefit from tax/mental/equity-based benefits of having
a stable home. If stable is what you want, that is.

------
sailfast
Max out your annual IRA contributions you idiot. Don't break the glass unless
it is to travel or be with family. Set up YNAB so you aren't kidding yourself
with rotating card spending. Cap your bar budget.

------
AndrewKemendo
You're asking the wrong question.

What are your personal goals in the next 5, 10, 30 years? What do you plan on
doing that requires money? How much money does that require?

Without knowing anything about your goals then any advice you will get (as
demonstrated in this thread) will steer you toward structuring your life
around saving money and getting safe but modest returns. Is that what you're
asking for?

Here is a question you should ask yourself probably every 6 months:

"If I had infinite resources (money/whatever) what would I do?"

Take that answer and then figure out how to accomplish that without infinite
resources.

~~~
kamaal
>>What do you plan on doing that requires money?

Everything that you will ever plan on doing will require money.

------
LVB
1\. Understand the basics of asset allocation, taxes and account types. Read
Bernstein for primers on these.

2\. Be highly skeptical of most of the financial services industry, especially
those selling load funds, insurance, annuities, and who want to manage your
money.

3\. Enjoy simple cars, or no car if you can manage. The amount of money I've
seen friends and family dump into vehicles over 25 years is staggering. I
don't even see cars at this point. I don't care what others drive, and I don't
care what I drive so long as it's reasonably comfortable, safe, economical.

------
ozzmotik
stop spending so much money on mind altering substances

------
AdamN
Have fun! Often doing things that are actually fun are the cheapest - like
buying an old wind-up record player and some 78s from the Salvation Army and
having a picnic with your friends (or a date!)

------
a5seo
If you are market timing, remember you have to be right twice, once when you
buy and second when you sell.

Ideally, you'll come to realize that trading is a waste of your time, and you
should set and forget a regular investment flow into the Wilshire 5000 or
something equally diverse.

Lastly, don't let FOMO lure you into into investing in the new hotness of your
age. For me, it was Internet stocks in 98-99. By the time you're hearing about
it and it's productized in a way consumers can get involved, it's too late.

------
dlwdlw
Index investing is great, but don't be afraid of taking risks for things you
believe in. Actions where you put something at risk are those that truly show
who you are. Constantly evaluate your emotions of fear and greed as to avoid
falling into the trap of gambling or the trap of mindless following without
the courage to think for yourself. Position yourself so that you either gain
or learn from your risks. The only games that matter are those with your skin
in the game.

------
thatwebdude
If you're handy, and your housing market isn't super-hot right now (read:
unaffordable), consider rentals. With the right tenants in a good market, it's
quite passive income. And the build up of equity will provide a cash-out
option later in life you may benefit from (if you choose to use it).

But don't rely on it, and don't overextend yourself. Traditional investment
strategy is still a very good, solid one.

------
bluedino
Save for 6 months and buy that $2799 PowerBook with cash instead of paying the
minimum payment on that 22% MacMall card for the next 5 years.

------
theandrewbailey
Good job on hitting the tuition free college jackpot. Keep paying off the rest
of those loans, but don't stress out about it. Those will be paid soon enough,
but get a credit card before they are. Keep being careful about what you're
spending.

Move closer to your office. Even if the rent is a little more, the price is
worth it if you don't have to use your car all the time.

------
zrail
Max out your 401k, even if the options look crappy.

~~~
davidcbc
Don't forget your Roth IRA (if your AGI is <= $118,000).

In that scenario I would recommend this priority: 1) Put enough into your 401k
to get your full company match. If you don't you're throwing away free money
2) Max out your Roth IRA. They have more investment options than 401k plans.
3) Max out your 401k.

~~~
zrail
Yes, although people starting in a tech job in a reasonable housing market
these days should have no problem maxing both.

------
bungie4
(From a 57 yr old talking to his 25 yr old self)

If I had all the money lost from 'stock market corrections' on my investments,
I could retire comfortably today.

Stop being a little fishy swimming with big fishies.

The interest paid today is a pittance compared to the risk. Save your after
tax money in something with near zero risk until the interests rates rebound
to make the reward worth the risk.

~~~
majewsky
You think the interest rates will rebound?

Honest question. I'm quite young (27), so most of my impressions of the market
have been post-subprime-crisis.

~~~
colefichter
> You think the interest rates will rebound?

It doesn't matter. If the bank pays you 10% on a savings account it's because
inflation is high as well. In my opinion, bungie4 is giving you advice from a
rather cynical world view. I understand it (sounds like bungie4 has taken some
bumps and bruises in the market), but I don't agree with it.

A savings account will never give you more than about 1% real (inflation
adjusted) returns because it's completely safe.

To both of you, I would say _don 't sell during a correction_. You need to
stick with the plan when times get tough. Paper losses are scary, but they are
only on paper.

(Funnily enough, folks love volatility when it's in the right direction. Home
equity is great, right? But for some reason paper losses send us into panic
selling mode.)

~~~
bungie4
I'm speaking of Retirement savings plans, in Canada RRSP's and the like, like
your 401K's in the U.S., which, in turn are heavily invested in different
investment vehicles. When the market goes south. So do they. You have no
control over how they are managed. It's not 'only paper' when your balance
goes from 100 to 50.

Yup, been burned many times, losing half of your net savings tends to make one
cynical. But this post was about what you would tell your 25 year old self.
That would be my number one thing. You can choose to ignore it or not. Sounds
like you've got this figured out, so you should be golden.

~~~
TheCoelacanth
You can choose what the money in a 401k is invested in. They don't hold money;
they hold financial instruments like stocks, bonds and funds made up of stocks
and bonds. If you don't sell those financial instruments when the market is
down you will not lose money.

~~~
thatwebdude
Yes, if your financial advisor isn't doing their job you can fire them. Many
of them (used to) have skin in the game with your money, too.

Also, lots of folks who lost out on the last recession would be in an equal
place post-recession had they left them money to recoup the losses. It
wouldn't have been gains, but it wouldn't have been the kind of losses they
experienced either. Much easier said than done, though. I don't blame them.

------
miguelrochefort
Time in the market beats timing the market.

------
sotojuan
This might be dumb and I'm only 23 but if you live in an expensive city/area,
get a roommate/SO/whatever for a year or so. Funnel all saved living expenses
to loans/savings account. It's not as nice as being alone but man, it's a lot
of money saved.

------
forkLding
This seems relevant in a way: [https://chrome.google.com/webstore/detail/pay-
with-life/fmpb...](https://chrome.google.com/webstore/detail/pay-with-
life/fmpbkddacnibdlnffgbjelegfcgnhdcm?hl=en-GB)

------
gremlinsinc
THere will be this thing called bitcoin -- you do everything you possibly can
to buy up as much as you possibly can then you hold it till 2017... if you
don't hold it or lose the wallet you'll want to commit suicide, so don't do
that.

------
NumberCruncher
Save up as much as you can and put it into risk free investments. Wait until
there is blood in the streets and put everything into the DAX/DOW/ whatever
index or economy too big to fail. Sell out at 100% profit. Repeat.

------
yotamoron
Forget the money, so you can make enough of it doing what you love:
[https://www.youtube.com/watch?v=khOaAHK7efc](https://www.youtube.com/watch?v=khOaAHK7efc)

------
dennisgorelik
By the time I was 25 I already followed all the good advices listed in the
comments here.

The only advices missing are predictions that are possible only with actually
observing the future (e.g. buy GOOG/AAPL/AMZN).

------
DanBC
START YOUR PENSION. PAY INTO YOUR PENSION.

Also, put some money aside for savings.

------
markivraknatap
Don't buy an expensive car. After a while all cars become a means that takes
you from place A to place B. Save that money and invest it wisely somewhere
else.

------
EliRivers
Don't waste your time with cash savings. All of it into a handful of low cost
index funds with dividends reinvested.

------
brimstedt
\- save in stocks, not savings accounts or funds

\- dont waste money on tv subscriptions

\- play less videogames

\- take greater care of your friends and relations

------
floorlamp
For me this was last year, so just this: Convert all Bitcoin to Ether and then
buy more Ether with USD.

------
_e
Cash is king.

~~~
thatwebdude
Agreed. You still have great buying power (locally) when every other merchant
out there is demanding their piece of the pie.

------
bencoder
Don't sell those 1000 bitcoin

~~~
foota
You had 1k in Bitcoin?

~~~
ac29
Remember, that was worth about $10 at some point (not each, total). I had
dozens of bitcoins and sold them when they went up in value by 1000% or so
(this was 2011). Still dont regret it, even though I'd be sitting on a quite a
bit of hypothetical money if I had kept them.

------
iamgopal
Should have invest myself instead of giving advice to others to invest in it.
Really.

~~~
_e
Just curious, did you advise others to invest in a specific product, business,
market and or idea? Micro or macro?

------
shove
"that girl is poison"

------
pdnell
Invest that $10,000 in bitcoin.

------
kasey_junk
Don't buy that condo.

------
smarptlaya87
well im not really saving im investing in my own company.

Im building my start up ejgiftcards.com. Its generating revenue with about
20-30% margins. Current revenue is about 50-60k per month.

------
taway_1212
Consider jobs out of your (my) country ASAP, they do pay better.

------
pelf
Spend all your money on bitcoin and WAIT. Trust me. Do it.

------
amingilani
Turned 25 last month, your advices are very helpful.

------
unstatusthequo
Put $150 a month into a RothIRA. Every month.

------
jshelly
Want vs. Need

------
petraeus
Start playing the stock market

------
dec0dedab0de
Do not buy a house.

~~~
aliston
Why do you say this?

~~~
dec0dedab0de
because it was late 2006

------
SirLJ
The Lottery numbers for the big jackpot...

------
muninn_
Uh, well it's the same advice I'd give somebody now:

1\. Max out employer's 401k match. 2\. Build emergency fund to 3-4 months
expenses 3\. Max out Roth IRA 4\. Pay off low interest loans (if you have
high-interest loans, which I don't/haven't then this becomes #1 and pay them
off first).

------
kapauldo
Put the irs limit into an ira invested in the s&p 500 and forget about it.

------
Bahauddin
yes

------
Psyonic
Go all in on ethereum.

------
taf2
Buy redhat stocks it's at like $4. Oh buy apple, google and amazon too.

~~~
namlem
If you want returns from the early 2000s to today you buys Domino's stock.
Yes, the pizza chain. Just look at their stock performance and you'll see why.

~~~
taf2
Good call - I just always remember looking at red hat stock in the gutter and
thinking I should buy this... so naturally that is what I'd tell myself to do

