7 Things Financial Experts Wish They’d Known When They Were Young
Having financial security is important. But a lot of times, that security comes with age, practice, and patience. So young people, listen up. These are the seven things financial gurus wish someone had taught them when they were younger:
- Skills are worth more than a job.
“Optimize for learning, not earning. It often comes down to prioritizing skill acquisition over immediate post-college earning. The only true job security is a superior skill set,” says Tim Ferris, angel investor and best-selling author of The 4-Hour Workweek.[1]
With strong skills and knowledge, you’ll be far more likely to weather a questionable economy and potential hits the job market takes.
- Chase something you love instead of money.
“I wish I knew that the best advice for any person is to follow their passion as opposed to chasing money. I’ve seen time and time again that people who foster their true passions and true callings are the ones that end up the most successful,” advises Blake Mycoskie, founder of TOMS.[1]
Chasing something you’re passionate about and inspired by will keep you happier and more satisfied holding particular jobs. It’s what makes you glad to go to work in the morning and put in all those long hours and hard work.
- Have a plan for your money.
“Not having a financial plan is a plan—just a really bad one,” says Alexa von Tobel, founder and CEO of LearnVest and the author of Financially Fearless.[1]
Plan early for your money. Know the kind of life you want so you can figure out how your money will help get you there. If you need specific steps for planning, check out this helpful post.
- Be wary of credit cards.
“Credit cards are the worst investment that you can make. The money I save on interest by not having debt is better than any return I could possibly get by investing that money in the stock market,” claims Mark Cuban, billionaire entrepreneur and investor.[1]
While a lot of young people think they need to build credit, cards are risky, with first time users getting into debt way over their head.
“Building up a bad credit history will hurt you more than having no credit history. You don’t need to feel pressured to get a credit card,” says Zac Bissonnette, author of Debt-Free U.[2]
- Limit student loans as much as possible.
“Do not take out more in student loans than what you are projected to earn in your first year after college,” advises Suze Orman, author of The Money Book for the Young, Fabulous and Broke. “Remember, going to an expensive school doesn’t guarantee success. The school never makes you, you make the school.”
Many young people are on their own when it comes to financing their secondary education. It’s important to not get too focused on glitzy and famous schools because they can come with a huge price tag. More financially reasonable education options can also provide top-notch degrees.
- Finish school as quickly as you can.
“Many kids are finishing school in five or six years. But every extra year is potentially an extra $30,000 to $40,000 in expenses,” says Farnoosh Torabi, author of You’re So Money. “Map out your coursework and figure out exactly what you’ll need to do each semester. Be vigilant about sticking to your plan.”
Young people can start focusing on their college goals in high school. By mapping out their desired degree and the required classes it will take to get them there, they’re able to spend the minimum time in school and save the maximum amount in tuition and other related fees.
- Take a finance class.
“This way, when you graduate, you’ll be better equipped to manage money for the rest of your life,” says Brittney Castro, CEO of Financially Wise Women.
Many young people have to take a basic economic or finance class in high school or college. Take advantage of this time to really familiarize yourself with the inter-workings of strong personal finances so you’ll be set up for a solid financial future.
Take advice from people who’ve been there. Right now is always the best time to get your finances in order and map out how you plan on using it for the rest of your life.
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[1] Kane, L. (2014). What 9 successful people wish they’d known about money in their 20s. Accessed October 8, 2015. Retrieved from http://www.businessinsider.com/what-ceos-wish-they-knew-about-money-2014-9
[2] Re3nzulli, K.A. (2014). 12 things we wish we’d known when we were 18. Retrieved from http://time.com/money/3148225/college-financial-money-advice-class-of-2018-freshmen-suze-orman/
