4 answers
Maya
Student
1
Question
Asked
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What should I be doing financially now so that way I can be successful in the future?
like how much money do I need to put into the side now then in the future how much more?
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4 answers
Dave Henry
High school teacher
27
Answers
Maryville, Tennessee
Updated
Dave’s Answer
I grew up very poor. Actually, I didn't know I was poor. But I did some things so that I wouldn't be poor the rest of my life. First of all, I went to college and got a college degree. People who have a degree have a better chance at making more money in the long run. The second thing I did was I saved 20% of whatever I made. And if I had an opportunity I saved even more. If you have an employer who has a 401k and will match part of your salary, ALWAYS do this. And put as much of your salary away in a Roth account whether it be a regular Roth account or 401K Roth account. Pay the taxes now. In 50 years when you go to take this money out it will be taxed free. You can thank me later. The third thing that you should remember is never rely on anybody else for your financial needs. Whether that be the government, and employer, a spouse, or family, never rely upon anybody else to help you financially. Take care of yourself.
Invest in stocks, or more specifically, mutual funds that owns stocks. You will probably double your money every 8 or 9 years. And the more you put in, the more you're going to have later. If you do these simple things, you will be a very wealthy person when you retire.
Invest in stocks, or more specifically, mutual funds that owns stocks. You will probably double your money every 8 or 9 years. And the more you put in, the more you're going to have later. If you do these simple things, you will be a very wealthy person when you retire.
Fred Rosenberger
Data Analyst
462
Answers
St. Louis, MO
Updated
Fred’s Answer
I am not a financial advisor. Please do not take anything I say as formal advice, this is just my opinion.
As much as you can. The more you save now, the less you need to save later. The more you save now, the sooner you can retire with the same income. And the more you save now, the faster it will grow - I'm sure you've heard the old "Compound interest is the strongest force in the universe" adage.
If you have an employer who matches all/part of your retirement, the be sure to maximize what they match - otherwise your loosing out on free money.
And it's always better to save something that nothing. Don't fall into the "well, I can't afford it now, so I'll start in a year or two" trap. People get used to whatever income they have. In a year or two, you'll be used to having that much money, and will not want to reduce your take home to start saving, and the cycle continues. It's better to start now, so you don't get used to having that money. Even if you can only save 1%, that's a start. Then, the next time you get a raise, you can increase your saving amount to 2% (or whatever). You'd still see a take-home increase, AND are now saving more for retirement.
As much as you can. The more you save now, the less you need to save later. The more you save now, the sooner you can retire with the same income. And the more you save now, the faster it will grow - I'm sure you've heard the old "Compound interest is the strongest force in the universe" adage.
If you have an employer who matches all/part of your retirement, the be sure to maximize what they match - otherwise your loosing out on free money.
And it's always better to save something that nothing. Don't fall into the "well, I can't afford it now, so I'll start in a year or two" trap. People get used to whatever income they have. In a year or two, you'll be used to having that much money, and will not want to reduce your take home to start saving, and the cycle continues. It's better to start now, so you don't get used to having that money. Even if you can only save 1%, that's a start. Then, the next time you get a raise, you can increase your saving amount to 2% (or whatever). You'd still see a take-home increase, AND are now saving more for retirement.
Thank you for taking the time to help.
Maya
Anand Cavale
Business Executive
3
Answers
Princeton, New Jersey
Updated
Anand’s Answer
It depends if you are working and how much you ar eearning.
If you are working, as a rule of thumb, you should contribute to your 401k if your company allows it and then make sure that you have at least 6 months of salary in an "emergency" fund as a beginning
If you are working, as a rule of thumb, you should contribute to your 401k if your company allows it and then make sure that you have at least 6 months of salary in an "emergency" fund as a beginning
Kenneth Romanowski
CFP Board Emeritus (R), CTFA (Ret.), Instructor and Researcher of Financial History
29
Answers
Ardmore, Pennsylvania
Updated
Kenneth’s Answer
Hi, Maya! You ask a wonderful question. I wish more people would ask the same question when they are younger. As a long-time financial advisor, here are a few tips to help you:
1. Live within your means. Be sure that your expenses do not exceed your income. If that happens occasionally, just do your best to get back on track. If you are constantly spending more than your income, you either need more income (a better paying job?) or fewer expenses (cut back on things you don't really need).
2. Build an emergency fund of 6 to 12 months of your expenses, then invest 10-15% of your income in an employer plan (like a 401k or 403b). You may also consider an Individual Retirement Account or a Roth IRA. Don't tie up too much of your money in case of a big emergency. At the same time, as Fred pointed out, the more you save now, the less you will need in the future.
3. Educate yourself with unbiased financial information. Don't be tricked into the latest fad. If someone is offering a financial product, ask yourself if it is best for you OR the person offering it to you.
4. Consider speaking to an objective professional in the field. There is so much more to learn, but you are off to a good start. All the best to you!
Ken
List your income versus your expenses and be sure your income is above your expenses.
Build an emergency fund before investing.
Educate yourself.
Speak to professionals in the field.
1. Live within your means. Be sure that your expenses do not exceed your income. If that happens occasionally, just do your best to get back on track. If you are constantly spending more than your income, you either need more income (a better paying job?) or fewer expenses (cut back on things you don't really need).
2. Build an emergency fund of 6 to 12 months of your expenses, then invest 10-15% of your income in an employer plan (like a 401k or 403b). You may also consider an Individual Retirement Account or a Roth IRA. Don't tie up too much of your money in case of a big emergency. At the same time, as Fred pointed out, the more you save now, the less you will need in the future.
3. Educate yourself with unbiased financial information. Don't be tricked into the latest fad. If someone is offering a financial product, ask yourself if it is best for you OR the person offering it to you.
4. Consider speaking to an objective professional in the field. There is so much more to learn, but you are off to a good start. All the best to you!
Ken
Kenneth recommends the following next steps: