If you’re in college and reading this,YOU ARE SMART! Not only for getting into college (naturally) but for wanting to get a head start on your finances. When I was your age the only thing I cared about was women & beer pong – and in that particular order. As long as I had enough to survive, I didn’t want anything to do with financial management 😉
Unlike me though, you want a head start in life and you’re doing something about it! So today’s post is directed at you, along with a fellow student of yours looking for some help. We’ll call her Miss Roxy for the fun it. Here’s her dilemma, along with my thoughts on it:
“I’m 19, in college, planning on marrying in summer of 2012. I can’t save much right now, but I know eventually I’ll have a job and I want to put away for retirement. The problem is, I’m not sure how to. I know that sounds silly because there are posts about this all over the place. But the problem is, there is a chance that my future husband and I might be moving to a different country within the next ten years. How does that effect my retirement savings and can you help me?”
First off, good for you in trying to plan all this stuff out! I couldn’t tell you what I was doing for lunch each day, regardless of planned weddings, moving, etc so good job. That being said, I think life is too crazy and will change when you least expect it – esp. in the next 10 years. That doesn’t mean planning for retirement and the wedding shouldn’t be done right now (it totally should!) but just that I wouldn’t worry about having the *perfect* game plan at this point in your life. It’ll always be a work in progress.
THAT being said (again, haha…) the answer to your question depends on a slew of variables. Here are a few things I wish I had thought about back in the day:
5 Financial Tips to Get Your Mind Right
- Save save save! Every time you get paid, get cash presents, win the lottery, etc, stash at least 10% of it away. You do this for the rest of your life you’ll have plenty of money, believe me. It’s one of the simplest things anyone can ever do.
- Find as many income streams as you can. Work side gigs while in college, get a good job when out (and if it takes a while to find one, at least work others in the meantime!), etc. Without income you can’t do squat. This applies to both you and Mr. Roxy 😉
- If you’re looking for an investment vehicle, besides a saving account, try a Roth IRA. You can put in $5k a year that will grow TAX-FREE for the rest of your lives. As long as you don’t hit the maximum income to be able to contribute (it’s over $100k so you don’t have to worry about that right now), it’s one of the first places people usually advise to put money in.
- Contribute at least up to your employer’s match in your 401(k) plan. This doesn’t apply now as you don’t work full-time yet, but once you do make sure to contribute at least whatever they’re matching as it’s FREE money for doing nothing saving (which you should be doing anyways).
- Create a simple budget and review it once a month. It’s boring at first, but once you get into the habit you catch yourself spending more than you should be 😉 Give free budgeting sites like Mint.com (affiliate) a shot, or see if any of the excel spreadsheets I gathered does the trick! As long it gets you to take action, it really doesn’t matter which.
You & your man follow a few of these, and you’ll be just fine 🙂 People make this stuff a lot harder than it actually is. When it comes down to it, it’s all about spending less than you earn, and saving the rest. That’ll leave you with plenty of money for the wedding, retirement, and whatever else you’re planning up.
Anyone want to add anything else? Maybe some tricks/lessons YOU learned in college?