Just looking for some advice some of you older guys wish you had upon going into the workforce.  I graduated from college the week before last, and today was my first day as a full time, salaried employee with the company I completed an internship with.  My first paycheck (and signing bonus ) will be deposited into my account tomorrow.

Some basic info:

Starting salary is >$50,000
No student loans.
Single.
Fairly new and paid for truck.
Use CC for most purchases but pay off in full every month.
Have a Roth IRA
Employee offers limited 401k matching.
I currently rent a house with a room mate.  I will be in the area for approximately another year, so will have no changes until then.  Rent and all utilities, tv, internet is never more than $750/month/person.

Between being in school and graduating, I will essentially have no additional expenses.  I will, however, be taking home about twice as much money.  My first goal is to max out my employer 401k match, followed by maxing out my IRA.  Second goal is to accumulate enough cash for 6 months of expenses should I ever be without a job.  Third is to begin saving for a house.

So my question is: What advice do you have for me or wish you had known at my age?  How else do you recommend investing my money?  Anything I should do differently?  

In today's market 6mos of cash reserve is not enough. I would say 12 to 18 is the goal to shoot for.

It sounds like you have the world by the tail. Seriously I wish I was thinking like you when I was your age.

My advice:

1) dont let some girl fuck up your plans. I have seen many young men with high ambitions derailed by a girl.

2) don't get caught up in keeping up with the jones's. You will see your coworkers buying all kinds of shit with their new salaries. Don't fall into the trap.

3) don't get lazy. By that I mean stay focused. You have been like a hawk getting where you are with no debt. Just because your income has shot up doesn't mean you can be sloppy.

4) don't fall for any gimmicks or get rich quick schemes. Lots of people prey on young people with good incomes trying to sell them crap like shady investments and crappy insurance.

Can't argue with anything that's been said except 6 mos savings should be good, especially here in TX now.

Only thing I can add is start a savings account (besides for your house $$). You'll eventually need a new vehicle, want toys, home/auto repairs, vacations, etc... Nice to be able to pay cash and go about your business.

ETA: Congratulations!!

Congratulations and well done young man.  Lots of good advice already, let me add a little more.

Make damn sure you  

A. take care of your health..your body is like a car, a little preventive maintenance goes a long way. Meaning keep up on your dental visits and regular Dr's check ups.  Far better to catch something early than play catch up


                                  B. Have enough insurance to cover the unexpected. Both medical as well as something like AFLAC to cover gaps and loss of employment due to injury/illness. Hopefully you'll never need it but far better to never need it than the opposite.


                                  C. GET A WILL and make plans in advance to cover your own funeral costs. I just had a good friend's husband die unexpectedly this week and he had none of this in place and they are going to be getting by in the near term only by the generosity of friends. Don't                      put that extra burden on your loved ones if something should happen.

Buy property.

Don't buy a new fucking car every three years.

Don't collect dumb shit.

Sounds like you've got a good plan so far.

I suggest you:

- develop an expense budget
- follow the budget (but adjust as needed when necessary)
- set up an automatic transfer from your checking to savings for the average excess of revenue over expenses
- if you get a raise or bonus, plow at least half of it into savings
- once you have 6-12 months of savings in low-risk investments (savings, CDs, etc.), start investing in the stock market - ETFs or mutual funds at first
- don't scrimp on car or health insurance
- don't bother with life insurance until you have dependents
- figure out where you want to be in 5 years and then develop a plan to get there

Most people waste money because they don't know where they are spending it or where it's adding up.

Don't save money for specific things, just save whatever you don't want to spend. Make sure you have a mix of pre and after tax savings so that you have accessible savings and don't need permission to access it.

Don't let money own you. Take advantage of the things that are important to you when they are available to you.

No single purchase of less than your annual salary is going to financially ruin you. But make it count if you are spending it on things that depreciate.

start your 401 or roth as soon as you can, and contribute as much as you feel comfortable with. then when you get married get your life ins. policy while you are still young and healthy so the rates will be low for the next 10 -20 yrs. make smart big purchase decisions . and when you buy your house remember you make your money on the buy not the sell. (buy it low and sell it high )
dont get discouraged when you see your retirement statement only went up a little bit    it will be well into 6 figures before you realize it.

Max out that 401k.

Live frugally, but don't forget to go hog wild every once in a while.

Look into buying a home once you know you're going to be in one place for 7-10 years.

Bitches cost money.

Try to avoid eating out all the time.

We're the same age and in a similar financial situation from the sounds of it, minus the job part. I'm going to school. Sounds like you're on the right track. Just make sure to follow your financial rules and not make stupid decisions.

Listen to this audio (or read the book):  The Richest Man in Babylon.  It is based on lessons taught centuries ago and is relevant today as it was back then.  It will give you the mindset.  When you choose a spouse which is perhaps the most important thing you do in your life, make sure she is on board with the teachings of this book.  

Second, get a financial education.  Learn about our monetary system.  We are amidst a paradigm change and the things my generation did to succeed (school, work, save & invest) are changing.  Don't limit yourself to the US.

start investing outside of your 401K

http://smile.amazon.com/dp/B00JCC5JKI


This book is not very long but it is packed full of stuff.  And it's cheap.  

Congrats.

1)  I think I dodged a huge bullet with the last girl I was dating.  Planned on asking her to marry me, but things went awry.  Been single and taking things easy since.

2) Speaking of this, I got back from vacation to see my room mate's brand new FX4 Lariat Ecoboost F150 parked beside my truck.  While I may buy a new(er) vehicle in the next year or so, I'm content with what I drive now.

Thanks for the advice.

These are things I hadn't really thought of.  I am in good health.  I eat healthy and am quite active.  I do mean to get a membership at the gym right down the street, but have yet to do so.  I have good insurance through my company.

A will and funeral expenses are definitely two things I had not thought of.  I will look into these.

Eating out is surprisingly expensive.  I used to eat out almost every meal and was spending way too much.  Lately, I've been cooking a few multiple serving meals on Sunday and eating them throughout the week.  Still go out for lunch a few times a week with my coworkers, but I have cut down on food expenditures tremendously in the last few months.  I have to say I feel quite a bit better eating healthy, home cooked meals as well.

I'll check out the book recommendations, too.  Currently reading I Will Teach You to Be Rich, which reminded me to check this thread.

I also got enrolled in my company's 401k program last week.  I'll be contributing the amount needed to maximize their match.

"The Power of passive investing" by Rick Ferri might be another book to review. Your savings rate initially, in your investment future is paramount, as I think that book will show you. "Compounded" or compounding funds should be a theory you should explore at lengths', at your age understanding it is illuminating for many.  The Coffeehouse investor, and All about Bonds are two more easy, must reads. Good luck, sounds like your on the right path!

wow, good job, I was going to tell you to set up a portion of your direct deopsit to go to antoher savings account so you actually start building up a savings but you are way past that.

Do watch out ofr GRQ  & MLM schemes.  The people that run these opratios really prey on two categories:
1. desperate houswives (e.g. Avon)
2. young naive

Plodding does it.  after that, the general rules to become a millionair at retirement:

hold down job, get & stay married, no bastards, Budget to live on 60% of pay.  10% into retirement, 10% to long term savings, 10% for irregular expenses (new truck transmission etc) & 10% for fun hookers & blow.   You budget your mont to month lifesyle on 60% but you are really living on 80% b/c you will spend the fun & emergency expenses savings.

probably you should bury a few grand cash in the backyard, 20's, in case there is deflationary collapse/bank runs.   be sure to keep you bank cash withdrawl slips, in case you have to prove you innocence.

Sit down and write out goals, financial and otherwise. Also do a written budget, I use a simple spreadsheet myself.

Where you want your life to go and exactly how to get there.

Write it out.

Don't be lazy and just think about it.

Actually write it out.

Personally I'm on my way to very early retirement because I followed this plan. My financial goals are laid out for years and years in advance and so far it's worked out great. Every one is different but for me I wanted to retire early and live comfortably so I set an amount of residual income I needed from investments and the age I wanted to have it at. It required a lot of sacrifice from age 12-25ish but it paid off and saved me from struggling from age 20-death like a lot of folks.

It's not about what you make, it's what you save/invest and how you manage it. Most people I know say you can't get anywhere unless you make a bunch of money. I say that's baloney for the most part. Most people have a spending problem, not an income problem.

Keep a monthly budget. Track expenses/purchases. Know exactly where your money is going. It will take a few months of adjusting before you have your budget figured out.

You will be surprised by how much money is wasted once you start tracking every penny in and every penny out.

OP, listen to Doodlebug.  You are young and in the pole position of your life.  Have fun but remember: you will finally be who you are in your early thirties.  Rock it now with no regrets!

Quick credit card question:

I have 3 credit cards.  One, I use for everything and pay off in full every paycheck.  One, I have had for several years, but only use for Spotify and Netflix subscriptions.  The third, I stupidly opened last year with a furniture store when I moved.  

Looking at my credit score on Mint.com, I score poorly in age of credit.  If I close this newer account I don't use, will it help my score or have no effect?  (My utilization rate will still remain well below 20% with this account closed.)

Anything else I should be aware of if I decide to close this account?

Closing accounts will harm your score by lowering the amount of available credit. If you're not too concerned with your score and plan to pay cash going forward, then don't sweat it.



 

http://www.fatwallet.com/forums/finance/

ar-jedi

# of accounts and available credit seem to be more important than average age. I rate "good" to "excellent" on everything except age of accounts which is "poor" and my score is still around 800