Best financial advice you ever received.

Let’s keep this really simple. In two or three sentences, what is the best financial advice you received that helped you save for retirement?

Ours was to pay off our 10% interest mortgage 12 years early before using any of our savings to begin investing. Then take the rest and start by putting our money into an index funds like the Vanguard S%P 500 or total stock market.

So what was your best advice?

Spend Less Than You Earn.
Invest The Rest.
Repeat.

Regards,
-Chuck
Home Fool

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Start now.

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Time is your friend (i.e. “start now”, as the other poster mentioned).

Learn mutual funds and stocks, and use them.

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Minimize the “skim”

That 3-day financial planning course I took as an 18-yr-old Freshman in Engineering School was an eye opener. It was by far the most valuable course I took in college.

Course was taught by an Army Captain who was an instructor in the ROTC program.

The Captain brought in a stock broker, mutual fund salesman, life insurance agent and an estate planning lawyer and had them make a pitch for their services.

After they were gone, the Captain broke down what they said and pointed out where they were hosing you for fees and commissions.

To anyone who understood arithmetic and compound interest, it was pretty clear that you didn’t need to much more in life but “minimize the skim” to do very well financially.

I summarized this in a recent article on the REHP.

Minimizing the “Skim” – the Key to Retiring Early
https://retireearlyhomepage.com/minimizing_the_skim.html

intercst

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"So what was your best advice? "


My father told me that understanding how an investment generates earnings is critical. The
fastest way to lose money is to invest in something you do not understand.

Howie52

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My Dad used to say…

https://dictionary.cambridge.org/us/dictionary/english/a-pen…

'38Packard

  • not quite as “thrifty” as Dad, but have mostly always LBYM.
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“The market is rigged in favor of the patient person with realistic expectations.”

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Contribute to the 401k at least to the match and increase the percentage each time you get a raise.

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I got one suggestion and figured another out for myself.

My father, a tax accountant when IRAs first were created – Max out your IRA every year.

and my idea

Every time your take home pay increases, for what ever reason, save 50% of the net increase. Do not reduce your savings rate just because you have a reduction in your net paycheck.

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Let’s keep this really simple. In two or three sentences, what is the best financial advice you received that helped you save for retirement?

Join the Thrift fund and contribute the total allowed amount 10%. Years later when 401k’s came in contribute enough to get the company match. Take advantage of ESOP until they cancelled it.

Regards,

ImAGolfer (retired '03)

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Live below your means.
Save/Invest all you can.
Enjoy today.

JLC

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Understand COL for your area. If you can’t increase your income, moving to a lower cost of living will do essentially the same since money goes further.

Become content with your standard of living at some point, not increasing it with every raise. Bank your bonuses and invest your savings. Lots of good things in life are free.

Paying a lot of money for something doesn’t automatically make it a better product.

IP

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While nobody ever directly gave me any good advise I do remember hearing some old burn-outs say:

Save your money, kid Fortunately I was already doing that. Once you start seeing it pile up and you get a little older and learn about compound interest, mutual funds, heck, even savings bonds, the details sort of start filling themselves in.

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Some very old advice I first heard from my dad when he let me start to invest some money at age 13:

Bulls make money, bears make money, pigs get slaughtered.

AW

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Mom showed me an amortization schedule at age 12. Buy anything on credit you pay for it 3x over. Only borrow on things that increase in value.

Other than real estate I don’t take out loans. My visa is paid off monthly and I make 1.5% on every purchase.

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From my Dad:

  • Start saving for your retirement as soon as you get a job. It will be here before you know it.
  • Live one paycheck, preferably the smaller one, and save the other one
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“Live on one paycheck…”

We did that but it was the bigger one. Still heading for a very comfortable retirement. I was surprised at how several women I knew automatically assumed I would stay at home when my kids were born. They turned out OK despite a (gasp) working mom.

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I was surprised at how several women I knew automatically assumed I would stay at home when my kids were born. They turned out OK despite a (gasp) working mom.

I distinctly remember having this conversation with FIL just after I had delivered the twins 12 weeks prematurely. Did I mention that DH had gotten laid off from his job a couple of weeks prior to that? So when FIL asked if I was going to go back to work now that we’d had the twins, I looked him square in the eye and said “no, I thought I’d just quit my job and see how long we can go until we starve.” That was the last I heard about it. And then there was that pesky medical insurance that was provided by my job - the one that paid in excess of 7 figures to get both kids home with DS owning a solid 90% of those expenses.

Yeah, I can see where me being a SAHM would have been the best decision for us. Not.

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I was surprised at how several women I knew automatically assumed I would stay at home when my kids were born. They turned out OK despite a (gasp) working mom.

If Mama Ain’t Happy (Ain’t Nobody Happy) https://www.youtube.com/watch?v=h9eVKlF6kKw

Kids are resilient and can make just about any situation work that does not include a chronically unhappy parent.

IP