Today we continue the ESI Scale Interview series where people answer questions about their success at working the ESI Scale.
In short, the series focuses on what the interviewee is doing in the areas of earning, saving, and investing. They also get an opportunity to ask ESI Money readers for suggestions if they choose to do so.
If you’d like to be considered for an interview, drop me a note and we can chat about specifics.
With that said, let’s get started.
My questions are in bold italics and his responses follow in black.
OVERVIEW
Please tell us a bit about yourself.
I am a 24 year old male and live in what most would call a small, New England town. I graduated from college 2 years ago (also in New England) and am not married.
What is your current net worth?
As of writing this, my net worth is as follows:
- Non-Qualified Brokerage Account: $2,400
- Roth IRA: $15,900
- Company 401k: $7,400
- HSA: $1,600
- Cash: $2,000
Total = $29,300
- Car Loan: ($6,700)
- Car Value: ~$12,000 (I do not like to include this in my net worth since it is a depreciating asset)
Net worth: $22,600 (excluding vehicle)
I paid off my student loans shortly after graduation, so thankfully, no other debt.
How did you accumulate your net worth?
Ever since I was a kid, I knew I always wanted to do something with money. I remember sitting in a bank with my dad and thinking how cool it would be to work with money some day. That has always driven my passion for investing and saving.
When I was about 12 years old, a family friend of ours generously left me and my family members approximately $30,000 each. My parents slowly over the years gave me more and more of that money to be responsible with. I used it for various items (which I now regret, but hey, I was a kid) such as an Xbox or a new bike. I was never told specifically how much I had inherited until I was much older.
When I began my first job (server) my father suggested I take 10% of my income and stash it away. I am so thankful for that advice because it added up to be a sizable amount for a high school kid and taught me the value of saving very early on. My father was always frugal and I learned the majority of my savings “gene” from him.
During high school, I started to learn everything I could on investing. I read any book I could get my hands on to learn more and more. I took a business course and remember drilling my teacher with questions on the stock market and how to get in the game.
Then shortly after my 18th birthday, I opened up a brokerage account with Schwab to begin investing. Now, since I was 18, my parents gave me full control of the inheritance that was left (approximately $25,000 or so at this point). I took a small portion at a time and began slowly dipping my toes in the water. Eventually, I put as much as I could afford in and let it grow. I made plenty of mistakes that thankfully I have learned from.
When I got to college, I continued to learn anything I could. I enrolled in as many investment/finance courses that my school offered. I joined investment clubs and even sat in investment classes that I wasn’t even enrolled in, just to learn.
Throughout my schooling I needed to withdraw portions of my investments to pay for school. My parents helped me out by paying a decent size of my college tuition, but I was still left with some of the bill.
By the end of college, I was left with a degree in Finance and about $25,000 in student loans. Over the summer of 2016 after I graduated, I heard about Dave Ramsey and got hooked immediately. I decided I was going to pay off all of my student loans even though it KILLED me to sell some of my positions. My brokerage account at this point had ~$18,000 after all the withdrawals for school payments. I sold almost everything and threw it at my loans. Shortly after, I accepted a position at a financial services company and began my working career.
When I first started working, I was living at home so I was able to save a lot of money. Any money I had I sent straight to my student loans. Eventually, I had them paid off by early 2017 (8 months after graduation), and had accumulated $317 in total interest payments.
Next, following the Dave Ramsey steps, I started to pile together and emergency fund of 3-6 months of expenses which totaled about $6,000. In May of 2017 my car broke down and I needed something to get to work, so I ended up buying a 2014 Subaru for ~$22,000, putting me back into debt of $18,000 after my down payment.
I enjoy the car, but regret going into debt for it. Every month I pay off as much as I can afford to get rid of it. I hope to have it paid off in the next 5 months.
The long answer to this question is I have accumulated my net worth through a combination of inheritance, help from parents on paying for college, and saving as much as I possibly can.
I’ve maxed out my Roth IRA the last two years and plan to every year for as long as I can. I contribute 6% (to get the match) on my 401k, and throw any other money I have into my brokerage account. Once I have my car paid off, I plan on accumulating an emergency fund and then beginning to invest even more (~$1,800 a month).
EARN
Tell us a bit about your career.
I work in the financial services industry.
I started out making roughly $39,000 in late 2016 and through hard work and studying for licensing exams, have increased my salary to a base of $56,000 not including overtime. After taxes and deductions, I net about $3,500 a month.
Do you have a side hustle?
I do not have a side hustle but would love to get into one. I have been considering blogging and showing my progress along my years to show accumulating wealth from a young age can be done. I feel like the market is pretty over saturated for financial blogs https://esimoney.com/five-steps-creating-winning-25k-blog/, so I am hesitant about beginning.
I would also love to do financial planning consulting one day. I am super passionate about financial independence and helping others achieve their goals.
If you were rating these results on a scale of 1 to 10 (with 10 being best), what rating would you give yourself and why?
I would give myself about a 7.
I’ve made plenty of mistakes already, but I also feel like I am on the right path and ahead of the average person my age. I am thankful to have learned as much as I have at a young age because that is one consistency I see on all these blogs as far as advice goes. Start as early as you can.
I am also naturally frugal. I am not a spender and have never been. I don’t buy video games, brand new clothes every month, new shoes, none of that. I spend my money on what I need and whatever makes me happy, like going on vacations.
What are your future plans regarding growing your income?
I have been debating this back and forth with myself. I do not have any plans on any side hustle, and as of now, I plan on growing income through plain old hard work. I’ve been lucky enough to grow my income by a large percentage from where I started, mostly through taking initiative to take on projects that others aren’t willing to do.
I’ve thought about switching fields a bit to try and do more with financial consulting since I am so passionate about it, but I fear I won’t be able to make as much starting off.
I enjoy investing in dividend growth stocks, so continuing to pile money into these stocks will also help supplement my income, although I am just re-investing all of this today.
I hope to find additional source of income soon, whether it is through a side hustle, rental property, or whatever.
SAVE
What percent of your gross income do you save?
Since I am paying off my car loan currently, most of my income goes to that, so my savings rate is low today. When I finish with my loan, I will save about 30% based on my last calculation, which includes maxing out my Roth IRA and increasing my contribution to my Roth 401k, contributing to my HSA and the rest in a taxable brokerage account.
How did you get to this level?
I arrived at this level by watching my expenses and paying myself first. I make sure I do automatic deductions from my paycheck to my Roth and taxable brokerage account and then obviously the deduction to my employer sponsored plan.
I only spend money on what I need and what makes me happy. I’ve never gotten joy out of useless objects that keep me happy for a month and then are forgotten. I love investing and the stock market, so it isn’t hard for me to throw that money into my brokerage accounts to invest.
If you were rating these results on a scale of 1 to 10 (with 10 being best), what rating would you give yourself and why?
I would say an 8.
30% of income saved for a 24 year old I would think is above average. Do I spend money on going out with friends from time to time? Yeah. Am I perfect in my savings? By no means and I can certainly improve, but I think I am off to a good start.
What are your future plans regarding saving your money?
As soon as I am finished paying off my car loan (hopefully in 5 months), I plan to save up and emergency fund of 3 months of expenses ($6,000 to be safe) and then increase my contributions to my Roth 401k at work. I will also max out my Roth IRA and save all remaining money in a taxable brokerage account. All in all, I hope to be saving around $20,000 a year, if not more.
I am unsure when a house may be in the cards for me, so I’ve been debating whether I should begin saving with that in mind for a down payment, or not.
INVEST
What are your main investments?
I focus most of my attention on my Roth IRA because I have the most amount of money in it, and I can play around with stocks and not get dinged with tax implications (took me a little while to figure this one out). My allocation is as follows:
Index funds (~60%)
- Schwab Mid cap ETF
- Schwab Small cap ETF
- Schwab REIT ETF
- Schwab Emerging Markets ETF
- Schwab Short Term US Treasury ETF (Basically used as a money market for me-no transaction fees going in and out and has a decent yield)
- Vanguard Bond Index fund
Individual Stocks (~40%)
I try and keep 60% in extremely low cost index ETFs and the remaining 40% I like to invest in individual dividend growth stocks. I enjoy tracking companies and reading their reports. Since I am by no means a professional, I realize it isn’t smart to go 100% individual stocks, so I compensate by putting only 40% in.
My individual stock picks have (surprisingly) done better than my ETF allocation. This is mainly due to a few movers, and I do not expect this to continue just based solely on the fact that I know I am not a professional stock picker. I tend to believe I have just been lucky thus far. They have returned about 25% over the last year.
Since Schwab ETFs are commission free (with their brokerage accounts of course), any new money I can add to my Roth or taxable account I mainly put in those positions. It saves me on transaction costs, and when I need to re-balance, I will sell off some of the positions and allocate accordingly (again, free of transaction costs). These have returned about 20% over the last year.
Since I am treating my taxable brokerage account as a small emergency fund at the moment, I have it mostly invested in a Preferred stock to get a decent yield, and I put a limit order on it just in case the thing decides to tank on me. I am not aiming for growth in this account, so I do not monitor the performance too much.
In my 401k, I have it invested in 50% aggressive growth mutual fund, 25% in a Vanguard total market fund, and 25% in an S&P fund. I hardly ever look at the performance of this account, but did see it was up over 30% last year!
If you were rating these results on a scale of 1 to 10 (with 10 being best), what rating would you give yourself and why?
As far as allocation/performance over the last year goes, I would give myself a 7.
Before I learned a bit more about asset allocation, I would have given myself a 4. I was heavily invested in individual stocks and mutual funds I had no business owning. I learned from mistakes and learned to hold on to winners and dump losers. I have certainly made my fair share of mistakes when it comes to investing in individual securities, even at my young age.
What are your future plans regarding investing?
I plan to continue throwing any money I can into my brokerage accounts and my 401k to keep on growing. Compound interest works wonders and I can’t wait to see where it takes me.
I have also been considering purchasing a rental property. I am not 100% set on where I currently live, so I would want to be more comfortable with a ground base before doing so. It is a significant investment, but I think I could make it work.
WRAP-UP
What money mistakes have you made that others can learn from?
When you can avoid it, stay out of debt. I realize it isn’t always as easy as Dave Ramsey makes it seem. Sometimes it feels almost inevitable and sometimes it is. Could I have avoided going into debt to get my car? Absolutely. My back was against the wall for needing to purchase a car quickly, but I could have found something cheaper.
The other main money mistake which I am really just learning these days, is to only spend money on things that legitimately make you happy. So many of us buy unnecessary items day in and day out that we can live without and that give us no happiness whatsoever. I’d rather throw $50 in my Roth IRA and have that grow for me to utilize at a later date on something that will make me happy, then buy some item that I will forget about within a day or two.
I am happy with how early I started learning about investing and wouldn’t change the timing of when I started. The only thing I would do differently would be smarter about my purchases (including my car) and think long-term.
What are your financial goals/aspirations? What is your “Why”?
My goal is to be financially independent as quickly as I can, while also enjoying the life I currently live. I strive to be in a position in life that allows me to work if I choose to, but not be handcuffed to a job. I never want to feel miserable waking up and needing to go to work. I want to roll out of bed and be excited for what the day has in store for me. I enjoy my job I currently have for the most part, but it is not something I am ecstatic about.
I have plenty of passions I would love to take more advantage of, however, work prevents that. At the same time, I do not want to live such a demanding, frugal lifestyle that prevents me from going on trips, or going out with friends every now and then. I am young and want to take advantage of my younger years, but also understand how crucial it is to start young. That is the balance I tend to struggle with.
I strongly believe every single person out there has the capability of saving enough to get to their financial goals. So many areas of our lives are limited by money, which in turn make our lives limited by work.
Since I am just sort of starting out, and I know I have plenty of big expenses coming up in the future (house, wedding, kids, etc.), it’s hard for me to get a good sense of how I am doing.
Are there any questions you have for ESI Money readers regarding any parts of your finances?
How do you think I am doing?!? I have ALWAYS wanted someone to critique my situation, but it is so hard to find people to discuss this topic with you. Money is such a sore subject in most families that it is tough to speak with friends and family about it.
If you were in my shoes, what do you think I should change about what I am doing? I love constructive criticism.
What do you think of the idea of a financial blog tracking my progress? I realize there are hundreds out there, but I haven’t found too many where someone is (pretty much) starting at square one and building their way up. I think it would be interesting for young readers out there. I do not take offense to hearing “No way, too many out there already doing this”.
Chris says
I’m not big on the emergency fund, meaning, a Roth by definition is an emergency fund since you can always take out the contributions penalty free, just not the earnings. So why not max that out instead of waiting to accumulate the emergency fund first.
That said, congrats you are a fiscally responsible 24 yr old, a rare breed for sure.
Youngin says
Thanks for the feedback!
My one concern with using the Roth as an emergency fund is that if I needed to pull money out for a large emergency, let’s say $6,000, and I wasn’t able to roll that money back in within 60 days, then I would lose out on that contribution amount for the year. I believe that is correct but certainly correct me if I am wrong.
Dustin says
I am a few years ahead of you basically. Got lucky to get a good paying job out of college (you did a lot better through your pre-college years than I did) and paid off loans as quickly as I could. I am lucky enough to be married and own a house as of the last year, those probably are in your near future :). I would just do what you can to max out your 401k, keep doing what you are doing with your Roth, and be willing to get creative with whatever is left after that as the years pass. Keep at it!
Bernd Doss says
Interesting story and refreshing to see someone as young as you looking towards the future in many areas of the future. I say stay the course, refine your plan by developing a sound workable budget. Good luck with all that you might entertain.
Jason@WinningPersonalFinance says
It sounds like you’re well on your way to a prosperous life. Congratulations.
Your writing is terrific so you certainly can start a blog. If you choose to do it, I’d seriously consider what you want it to be. Will it be a way for you to document your journey or are you designing it to make money? I think it’s hard to do both. Yes, it’s possible to make money blogging but in most cases, there are much easier ways to make money. I have not yet monetized my site after almost a year now because to monetize you really need to sell something and I’m not sure that I’ve found the products/services that I want to sell to my readers. For now, it remains a tool that keeps me motivated to reach my goals.
I also aspire to work in financial planning. After years growing my career in a different field, it’s going to be difficult for me to change and go back to an entry-level salary. If you think you will enjoy a different career than that one you are in now, I’d seriously consider making the move sooner rather than later when you have more responsibilities.
Since you asked for criticism, I’ll throw one out there. Your investment plan seems to be a bit more complicated than it has to be. Why are you holding bonds at a young age? Why are you splitting your 401(k) in the two funds? Why are you holding so many ETFs and playing with individual stocks? I’m asking questions rather than giving advice because I think it’s important for each piece of your portfolio to have a purpose. If you have strong reasons for each holding that’s fine. From an outsiders perspective, I’d probably simplify and streamline it a bit.
Youngin says
Thanks for the feedback!
You bring up a good point that I haven’t really considered. Thinking about it now, my strategy is more complicated than it probably needs to be. Actually, definitely needs to be. And I don’t have a good answer for you, which tells me I should probably simplify it. I guess mentally it feels better to have my money spread between different asset classes rather than tying it all on one total market fund.
As far as bonds go, I have since sold off that position since I know it doesn’t make as much sense for me to own them at a young age.
The individual stocks I enjoy owning and learning about. It makes a boring process a bit more fun in my opinion.
Appreciate the honest feedback!
MBev says
I had similar questions. I’m 22 and have started aggressively saving/investing for the past 1.5 years, leaving me a current net worth around 22K. I budgeted out a 6-month runway for myself in cash, most of which is in an online savings account, giving me a 2% interest rate, as opposed to the .03 my brick-and-mortar bank was offering. The rest is invested in the stock market, 100% in ETFs. I know that’s a bit riskier, but with an investing horizon of ~50 years I’d rather chase higher returns. My company 401k is all in one mutual fund, which bothers me, but I’d pay higher fees to manage it myself so I’m kind of stuck.
My ultimate question is, besides just the enjoyment factor of picking those extra funds/stocks, do you feel you get that much more return?
M22 says
I think you are doing great! You sound a lot like me in my early days. Graduated with no student loans due to early personal savings and working (but no inheritance). Bought my first home at 24 and an investment property (duplex) when I was 27. Bought my second car (new) with a loan (first car was 12 years old and paid cash) and thereafter all auto purchases were with cash again.
Advice: I suggest you focus your investing 100% in low cost S&P 500 funds or Total market Funds (also Fidelity or Vanguard) and no bonds. I like that you at an early age is focusing on “retirement” funds (Roth, 401(k)). Buy cars that are 2-3 years old and keep them as long as possible (if you have a good car – keep it. if you don’t have a good car, get one). Keep up the good work.
Youngin says
Thanks for the feedback!
RocDoc says
I think you are doing great and I like your choice of mutual funds and ETFs. I would keep doing what you’re doing and keep learning. You are going to do well! There may be a lot of finance blogs out there but you are humble and write well. I think you should try having a blog if you have time. It would be a great place to learn and bounce ideas off people as well. In addition, you could probably make some side income with affiliate links.
SavvyFinancialLatina says
I’m 28. I experimented a bit when I first started out investing. I found out to just stick with a simple strategy of 100% VTSAX or a similar fund. Low cost index funds.
I’m slowly transitioning some money I have in other funds. It’s hard to let go.
I only have one individual stock. I transferred my stock from my previous’ companies ESPP. Worst performer ever.
Kristy says
You are doing fabulous, and a good job at learning life. I have a daughter same age, and I wish she had that much in her Roth IRA! She chose to get a job teaching in a high COL city, her rent is $1200/mo, and she struggles to save an emergency fund.
Youngin says
Thanks!
I’m lucky enough to have learned at a young age where I find the most joy in spending money, and I think it takes a while for everyone to figure that out, and Some never do. Luckily she has a parent like you who can guide her!
M50 says
I think it’s awesome that you are so financially savvy at such a young age. You are going to make it to FI, no doubt in my mind. How quickly is up to you and your work-life balance preferences. You will appreciate making and recognizing mistakes early (your new car purchase and bond funds for example) because they won’t cost you as much as they would if you make them later in life. At least you didn’t buy a $50,000 car. Now enjoy that nice Subie, take care of it and drive the wheels off for many years. You may pass it down to your first born some day. Okay, that may be a little extreme but I have a very wealthy friend who drove an ancient Subie he named Frankencar that was about 20 years old when he sold it (or maybe he junked it). He named it because he had to bolt plexiglass over broken headlight covers and many other parts were glued, duct-taped or otherwise attached…precariously.
Frank says
Awesome job!!! I wish I was like you at that age. Now in my late 40’s I too look back and seek advice for the future-which is also hard to get even at my age. I recommend staying on course. I thank God everyday as my career was going on supercharged and then got derailed-somewhat- by some dishonest and greedy coworkers who set me up. I was able to recover in two long years, but not at the same pay level. Thank God I saved so much over the years as now I have a position that I enjoy amd I am truly enjoying the less stress and security of a safer job. There is nothing worse than having a bad boss and hating to go to work because you need the money-been there done that. I don’t want others to suffer as I have through my horrible experience. I also would recommend something I didn’t do and regret-buy a duplex or four plex apartment and live in one and rent out the others. Keep up the good work.
Teri says
Wow, you are doing a fantastic job with your finances. Again, congratulation! That’s so good to see. Like many, I didn’t learn these things until much later in life so it makes me light up to see someone learning so early in life.
Have seen many references to a blog by jlcollinsnh.com about investing. I love it also and it helped me make more informed choices about my investments in the market. You might want to check it out, both the letter to his daughter and stock series are wonderful.
I believe the universe can use as many blogs about personal finance as people want to make. My hope is that the more this point of view gets out there, the more people will learn about the choices they are making and start making smarter ones. I have learned a lot in the last few years, since I discovering the Financial Independence movement.
Even if you don’t change a thing, you have wonderful future in front of you.
Debbie says
I second jlcollinsnh.com His Stock Series is excellent. He also has a book “The Simple Path to Wealth”.
ESI Scale Interview #7 says
Wow – you are doing an awesome job! I was ESI Scale Interview #7, and you sound just where I was at a few years ago. I’ve been in the work force for about 5 years now, and your article made me think of myself when I had just graduated college.
I can’t (okay, read below, I definitely can) say much more than keep on keepin’ on. You have your eye on the prize and will find a way to get there, one way or the other. Whether it be stocks, real estate, a business, or something else, you will get to FI. Focus on doing what you can, and enjoy the ride. If you want my super long feedback on your specific situation, keep reading!
Here’s my entirely too wordy and detailed take on your situation. Enjoy!
1. On consolidating your many Schwab funds: Other commenters pointed this out, but this doesn’t bother me too much. It’s not a bad idea to own a few funds that cover different market segments, so you can re-balance as those market segments ebb and flow. If you read ESI scale interview #7, you’ll see that I do something similar. However, what I did notice is that in your index funds you have no exposure to US Large Cap – this definitely raised my eyebrows. Another commenter pointed out that you can invest in a S&P 500 fund – this is a great place to start. Based on the balance of equities around the world, US large cap should make up a similar proportion of your (stock) assets.
2. No exposure to international funds outside of emerging markets: I personally think that emerging markets are going to have higher returns over the next couple decades than generic internal markets, but I wouldn’t put that as a reason to avoid other international funds altogether. I also don’t think my opinion means squat, so I’m personally not putting all my international eggs in to the emerging markets basket. I would at least explore the idea of other international exposure, and see if it has a place in your portfolio. However, I don’t think this is necessarily a must-do. Adjust course if necessary.
2. 40% of your net worth is in individual stocks. Compared to your net worth 10 to 30 years from now, the raw dollar amount in individual stocks is insignificant. However, having 40% of your net worth in hand picked stocks is ballsy. I have no doubt you know what you’re doing, and are likely much more educated than myself in this space, but this is a lot of risk exposure that you are opening yourself up to. Rule of thumb when picking individual stocks: never invest more than you’re willing to lose. If all that money went to zero, would you be ok with that? My personal cutoff for play money: 5% of my net worth.
3. Owning a house: Put this idea on the back-burner for a few years and let the steam cool off of it. I was verbatim in the same state of mind when I graduated college. My parents always told me about how home ownership was the way to go, and although I knew that a house wasn’t necessarily an ‘investment’ in the typical sense, I was hyper focused on needing to own a home, when that really wasn’t the case. A studio apartment in my building just sold for ~$300,000, so there’s that too… A few reasons for not buying a house now:
– Will you stay in your current area for at least 5 years? If not, and you still want to buy, will the house be cash-flow positive if you rent it out? Managing real estate takes time & sweat equity, and is harder to do remotely. If the house dose cash-flow positive, will it beat the return you can get in the stock market or with individual stocks? You are putting a lot down, and potentially tying yourself to an area before you have settled in to a career and a family. Now really isn’t the time unless you have friends who can help you find a great rental property that can become a key part of your portfolio.
– Your future spouse may not like the house you buy. Yep, seen many of my friends fall in to this category. They get married, and a few years later their spouse wants to either upgrade their lifestyle (see: bigger/nicer house) or move somewhere they like better. If you want to get married, be willing to leave the house you buy now, or manage it as a rental (see above concern).
– Based on your current situation, you would have to liquidate most of your assets for a down payment. Another reason not to go the home ownership route, this is a lot of your eggs in one basket. Don’t do any of the ‘zero money down’ shenanigans.
4. Potential career move: DO IT!!!! #1: Regret is a nasty five letter word. #2: All the old people you hear talk about it being harder to switch the older you get are speaking the t-r-u-t-h. It’s harder to leave a bigger paycheck when you are used to accumulating so much more. And I hate to say it, but it gets harder to break in to other fields when you’re older. With age comes the expectation of experience, and firms don’t really hire 40 year old dudes who know less than their team of young employees – it’s a weird dynamic. I’m in tech, so I may be a little more biased here. Take it with a grain of salt.
There it is! That’s all I have, but needless to say you are on the right course as-is. It’s all adjustments and tweaks from here. Save a lot, invest well, and go live your life. Pile beaucoup dollars in to your chosen investments and don’t sweat what happens after that. Compound interest will make sure FI hits you square in the face at some point or another in your life – it’s just a matter of when.
Youngin says
Wow!
Thanks for the great feedback!
Like I said, I’ve never had anyone really critique my job thus far and I love it. I wish more people were open to discussing their finances.
I definitely plan to pile up my money in the index funds before throwing more into individual stocks since I want to limit my exposure, but I do enjoy finding individual stock picks so I don’t expect to stop. It keeps things interesting.
I am very unsure of my living situation in the future. I for sure won’t be buying a home in the next 3 years I’d assume, so I figured I would at least start piling up some sort of down payment for longer down the line.
I will surely take your advice on adding some international exposure. I know I could use some of that. As far a large cap exposure goes, I figure my stock picks make up a good amount of that. Yeah I could be more diversified, but I think I cover it fairly well as I am pretty spread out.
I plan to make career moves in the next two years I would guess.
I for sure appreciate the constructive criticism!!
Jason says
I want to share this interview with all of my graduating college students. I keep telling them to start early, but the message often goes in one ear and out the other. I will keep banging the drum, but I might need to have other tactics as well.
Mysticaltyger says
I think you’re off to a great start. One thing I’d refine though, is the 401k allocation. A total stock market index fund and an S&P 500 index fund are about 80% the same. I’d just go with the total stock market index in this case. Slightly higher volatility, but slightly better long term returns.