In the 1960s Boston had a blighted crime filled neighborhood call the South End. The City, in desperation, sold houses that they had foreclosed on for $1 if the new owner would live there.
Today those houses sell for 6-7 figures! Shoulda, coulda, woulda..... Detroit cold duplicate thatI'm a fairly well reviewed, fairly well paid (10-15k/month) escort. I have just over 100k saved and I live very modestly (3k in monthly expenses, give or take). I'm under 25 and I would like some financial advice. Other than spending and saving, I'm unsure of what to do with the money I'm making. I plan to remain in the "business" for two more years and I'd like to have something to show for all my hard 
work.
Assuming you were in my age bracket and financial position what would you do? Advice from older men and women would be awesome! Thanks!
don't ask for advice here. Go see a 'real' financial advisor and have your business plan in line to 'explain' yourself and earnings. She (or he) has a confidentiality duty owed to you by default.
-- Modified on 8/31/2015 8:10:17 AM
and whatever you do, don't ask a CPA for investment advice. lol
The other thing to keep in mind that the advice you are looking for is more along the lines of what an athlete or someone else with a rather high income for a rather short duration would be looking for, and NOT the same advice suitable for a 25 year old with a "real" job.
You should be looking at your hooker savings as more of a "launching pad" or as "seed money" for the next chapter in your life, not as your retirement money.
and PLEASE PLEASE PLEASE, don't take any specific advice from any one from the peanut gallery here, and that includes me. Even those of us who know what we are talking about don't know enough about YOUR specific situation to give you specific advice. My advice is to find a pro, one who is NOT commission based and tell him the absolute truth about what you do and what you are trying to accomplish both with your finances and your life
Most people here have 9-5 jobs and relatively stable cash flow, neither of which apply to the OP.
She is NOT going to retire on a couple of hundred grand, what she should be concerned with is launching the next step in her career, and deciding whether her "bankroll" should be used to start something on her own, to use to offset her reduced income when she changes careers, or if she should put some/all of her money in traditional type investments.
NONE of us know what she is contemplating over the next 5-10-20 years and to offer specific advice without knowing what her goals are is irresponsible at best.
She is NOT going to retire on a couple of hundred grand, what she should be concerned with is launching the next step in her career, and deciding whether her "bankroll" should be used to start something on her own, to use to offset her reduced income when she changes careers, or if she should put some/all of her money in traditional type investments.
NONE of us know what she is contemplating over the next 5-10-20 years and to offer specific advice without knowing what her goals are is irresponsible at best.
She did not mention where she wants to be in 15-20 years but she did ask the older guys what we would do if we were only 25 and had 100K to invest. She also mentioned she was going to work 2 more years and now makes 10-15K a month. I don't see anything "irresponsible" about my advice.
but you never considered how much income she is going to have in two years after she ends her hooker career. She may well need the cash reserves while seeking a new career, she may want to launch a business with her hooker bankroll, she might want to do any one of a thousand different things in the next 2-5-10 years. To give a "one size fits all" answer is VERY irresponsible IMO.
To a carpenter, the answer to every question is a hammer. One size fits all answers to complex questions are never worth the paper they are written on.
She is NOT going to retire on a couple of hundred grand, what she should be concerned with is launching the next step in her career, and deciding whether her "bankroll" should be used to start something on her own, to use to offset her reduced income when she changes careers, or if she should put some/all of her money in traditional type investments.
NONE of us know what she is contemplating over the next 5-10-20 years and to offer specific advice without knowing what her goals are is irresponsible at best.
Gambler, She said: "Assuming you were in my age bracket and financial position what would you do? Advice from older men and women would be awesome! Thanks!"
She did not mention where she wants to be in 15-20 years but she did ask the older guys what we would do if we were only 25 and had 100K to invest. She also mentioned she was going to work 2 more years and now makes 10-15K a month. I don't see anything "irresponsible" about my advice.
A good property can always be sold or in some cases refinanced for extra cash. The chances of another RE crash is remote. If she plans on hooking for 2 more years, she will have enough cash reserves (she says she lives on 3k a month and makes 10-15k) while seeking a new career. Launching a business (unless she has extensive experience in a field) would be way too risky.
It sounds like your answer is to just sit on the money and do nothing. That would be very irresponsible
You really are rather slow on the draw, aren't you?
What I said is that ANY specific advice given here would be irresponsible. You don't have the slightest idea where she lives, how the RE market is in her area, whether she can even qualify for a loan or a refi depending on what kind of income (if any) she claims. Quite frankly, you don't know dick about her situation, and neither do the rest of us.
You most definitely proved my point that asking a bunch of hookers and whoremongers on a fuckboard for financial advice is a VERY bad idea. Most of the advice given here is nothing more than projection by the person posting it, but yours might be the worst of the bunch.
What I said is that ANY specific advice given here would be irresponsible. You don't have the slightest idea where she lives, how the RE market is in her area, whether she can even qualify for a loan or a refi depending on what kind of income (if any) she claims. Quite frankly, you don't know dick about her situation, and neither do the rest of us.
You most definitely proved my point that asking a bunch of hookers and whoremongers on a fuckboard for financial advice is a VERY bad idea. Most of the advice given here is nothing more than projection by the person posting it, but yours might be the worst of the bunch.
If she does take real world advice it should be from high net worth (2mm+) investors. who have proven it by doing not by theory. In that sense you are right about fuck board advice since most will never out ourselves to prove anything.
You still have not given ANY advice. All you do is trash others advice.
Seriously? FNMA and Freddi Mac are now buying loans with 3% down and allowing income towards repayment from nonborrowers who live in the same 'household' as the borrowers. What does this tell you? Tells me you're a fool to make a blanket statement like the above categorically.
I'm not THAT old and I've seen 3 RE crashes in the last 3 decades. Since the last one was about 5-7 years ago, what does THAT tell you?
I'm not THAT old and I've seen 3 RE crashes in the last 3 decades. Since the last one was about 5-7 years ago, what does THAT tell you?
The "experts" were saying it was the end of the world in 2009. Perhaps you should read some of Jimmy Rodgers books. He once worked for Soros . His philosophy is to buy disasters and short manias. I don't recommend shorting for newbie investors but his philosophy has made fortunes. His philosophy works in Real Estate too.
But you failed to answer my point. We ARE in another housing bubble promoted by the Fed and the administrations policies. To buy in now would be foolhardy especially directly in properties. Quit dancing around my point.
Oh. And while the real estate recession of the early 90's may not have compared to 08/09, if you were caught up in it it was pretty damn nasty.
Oh. And while the real estate recession of the early 90's may not have compared to 08/09, if you were caught up in it it was pretty damn nasty.
The factors that existed last decade just don't exist now. I don't consider what the fed is doing is creating a bubble. There is no housing mania today. The early 90's downturn was great for me. I bought in the middle of it and hung on for very substantial profits. Quick Flipping is not my idea of sound Real Estate investment.
I did not dance around your post. I'm not going to write a 50 page analysis of the housing market. I have 20+ years of successful RE investment experience and have no need to write a dissertation.
I forgot to mention that The programs you cited will only be available to low-income borrowers or those living in low-income or minority-dominated areas. That is not going to cause another bubble. From what I've seen some extended minority families do pool their resources to buy homes, businesses etc.
Do you realize you could have just opened your prior post and edited it?
-- Modified on 9/1/2015 10:13:46 AM
-- Modified on 9/1/2015 10:22:10 AM
My point which you clearly didn't grasp was these qualifiication changes are symptomatic of a market that's getting overheated especially in certain markets. Do you really think that folks with all of a 3% 'investment' in a home are prepared to stick it out through thick and thin if someone with 30% of the income in the house a) loses a job b) dies c) gets disabled or how about d) just stops contributing? What happens then? Exactly the tax payer ponies up. Again.
You need to stop. You're embarrassing yourself.
I'm not going to sell my house. I need somewhere to live. Its almost paid for and I can afford it so why would I sell it? I don't need the equity to live on and where am I moving to? A hotel? A tent? An apartment?
You have no clue. Jump in real estate now. Good luck with that.
I had more than one friend who didn't have that when the economic downturn hit, and they would have been hurt if it weren't for uncle Russ coming through with a no interest loan. I was paid back every dime and got some home cooked meals and a few rounds of golf though, so in the end it was a win/win.
At my stage of life everyone should have well more than that amount, but it's surprising how many folks don't, scary would probably be a better description. I was fortunate to have someone pound this idea in my pea brain while I was still in college.
I believe in every person to their trade. I'm very good at what I do, but I have no idea how to analyze and predict market trends, so I pay someone to do that for me (apparently I'm not very knowledgeable about the legality of divorce either as an earlier string of posts would suggest).
Please don't. Do. Not. Do. It.
Many guys get so into this that they begin to judge a lady if she doesn't stop what she is doing at that moment and take on the guys advice.
While I applaud the sincerity...it isn't always realistic as you clarified. Sometimes its a huge set back. For example...the push to get a real job. Thats cute and all, but to just say fuck half of your monthly income to go on interviews and say fuck the advertising momentum that creates such a monthly income can easily turn into a $60k loss before you know it. Believe me, I know. Excuse my french...had a flash back!
Get your money OP
For most financial advisors their FIRST and foremost priority is to make money themselves by enticing you to invest in such a way as to MAXIMIZE their commissions. Your financial well-being is second priority. It would be very, very hard for you to find a real honest-to-goodness advisor who is also good at what he does.
The easiest and simplest way for you to save is to go to your local banks and buy some CDs. The interest is rather low but your investment is 100% guaranteed by the US government. You will not lose one cent ever!
A slightly more complicated but with better return then bank CDs are bonds. Bonds by the US government or by local government such as counties and cities. You can invest in bonds without paying broker's fee by going to Vanguard or Fidelity web sites and invest in a mutual fund that specializes in bonds.
If I were you I would stop my risk limit right there. I wouldn't bother with the stock market for example
Proper investing is really boring and will make your eyes glaze over, but it's the best thing you can do at your age. Open Vanguard investing and IRA accounts. Max out your yearly IRA contributions and put most of your money in index funds (S&P 500, total market, etc.). Betterment.com is a great site for parsing all of this stuff and getting started.
There are a ton of early retirement/frugality blogs out there - start reading! If you do this right, you could be set for life by your early thirties. Good luck!
Talk to Vanguard and see what you think. They do a good job and have been around for a while. Finding a GOOD financial planner is not easy. They are a dime-a-dozen. You will not know how good he is until it is time to retire. Don't fall for the " Oh, you are young so we will put you in this high risk stuff". Every 6 months, check to see how your account is doing and pat yourself on the back.
There are a ton of early retirement/frugality blogs out there - start reading! If you do this right, you could be set for life by your early thirties. Good luck!
The advise was, that I should have at the very least 6 months of normal living expenses in my savings account, then after that invest wisely, for someone like myself investing wisely means having a financial advisor that I trust as I don't know or care to know the market.
Spending less than what you make and what you have is of course a no brainier, but far too few people follow that and are in debt up to their ears
work. Assuming you were in my age bracket and financial position what would you do? Advice from older men and women would be awesome! Thanks!
I am in general not a fan of financial planners. Generally if you have common sense and spend a bit of time doing your own research you will reach conclusions that are very similar to what the financial planner will charge you for. There are exceptions of course. But it will take a good bit of effort to find a worthwhile financial planner.
changed his whole philosophy from Warren Buffett style to a sort of momentum trader. I could not believe it. It was terrible.
He is out of the business now.
my dear. Your mature approach to your financial future will facilitate a happy life. Money isn't everything but it makes everything easier.
Get a good, trusted, financial advisor that will tell you what you need to hear, not what you want to hear. PM me and I will make a recommendation for your consideration (I will keep your information confidential).
Think about what age you would like to retire (never HAVE to work). Think about what income/lifestyle you would like to have after you retire for the rest of your life. Estimate how long you will live (based on family history) and estimate on the long side. Ask your financial advisor how much you will need invested upon retirement to achieve your goals. The financial advisor will help you think of things you are currently unaware of but which will increase your stability and security.
Study and educate yourself. Don't abdicate your responsibility for your future.
There are lots of good educational materterial out there. However, the foundation can best be laid by reading the flowing little book: http://www.threerules.org
I wish you the best!
TONY
For every dollar you invest, you will have 2 dollars in 10 years (if you invest wisely), If you have paid your taxes or you can account for the money in an IRS audit then buy a house or an apartment, but you want to make sure you won't need the money for the next 3 to 5 years. Commission for real estate is very high (5-6%) so it's not a good idea to buy and sell in less time (normally). For long term investment, it's likely the best 1st investment (for most people) due to leveraging (you can borrow money) and tax treatment (you can reduce your income tax).
You have a couple of issues to address:
Be sure that you've paid taxes on the money, otherwise your investing will raise some flags.
Get some advice from someone you trust who is knowledgeable.
As young as you are, invest in the market with solid growth stocks or mutual funds.
Get an accountant to figure out how much taxes u wanna pay, then once u report income, you will be able to start investing, and, I personally recommend the stock market, and diversification. You're at a good age to be a bit aggressive in your investing.
If u have a business idea that would also be one possible venue. It all depends of where you feel most comfortable investing your $$$.
Seek advice, don't go with the first person u seek advice from. Shop around. 
work. Assuming you were in my age bracket and financial position what would you do? Advice from older men and women would be awesome! Thanks!
work. Assuming you were in my age bracket and financial position what would you do? Advice from older men and women would be awesome! Thanks!
This is a long term strategy of 15-20 years. I started in San Francisco a few years after the 1989 earthquake. I could have retired off of it years ago. While SF has been one of the best areas for Real Estate investment, it's not the only area you can make money over the long term. Since your only 25, you certainly have the time to reach financial independence while you're still young enough to enjoy it.
I am not a fan of financial planners since most are commissioned salesman who push whatever "canned research" they make a commission off of.
Regardless of what vehicles you decide to use for investments, nothing works quite like The Theory Of Contrary Opinion.
Good Luck
Financial advisors are pushy and don't have your best interest at heart.
My solution?
Hire a woman. Problem solved.
work. Assuming you were in my age bracket and financial position what would you do? Advice from older men and women would be awesome! Thanks!
I've made almost every type of investment there is at one time or another. I don't know what city you are in (hopefully not Detroit or some dying industrial town) but nothing has paid off over the long term like my rental properties. Best of all you can always do tax free 1031 exchanges with your properties when you want to trade up.
This is a long term strategy of 15-20 years. I started in San Francisco a few years after the 1989 earthquake. I could have retired off of it years ago. While SF has been one of the best areas for Real Estate investment, it's not the only area you can make money over the long term. Since your only 25, you certainly have the time to reach financial independence while you're still young enough to enjoy it.
I am not a fan of financial planners since most are commissioned salesman who push whatever "canned research" they make a commission off of.
Regardless of what vehicles you decide to use for investments, nothing works quite like The Theory Of Contrary Opinion.
Good Luck
In the 1960s Boston had a blighted crime filled neighborhood call the South End. The City, in desperation, sold houses that they had foreclosed on for $1 if the new owner would live there.
Today those houses sell for 6-7 figures!
Shoulda, coulda, woulda.....
Detroit cold duplicate that
Today those houses sell for 6-7 figures!
Shoulda, coulda, woulda.....
Detroit cold duplicate that.
but there are soon many rules that come with it.
starting with you have to live there for a certain amount of time and you have to show proof that you are actually living there.
...is not in a position to speculate. She needs to invest in something with a proven return. If it's in real estate, it should be in an area that's very desirable right now, not ten years in the future.
because you are living well below your means. I know so many older gals who are struggling these days because they had to have this or that (mostly shoes), and did not save.
The best way to live well is to not need much in the first place. So kudos to you.
If you have the mindset and time to study finances, you'll do best that way, but not everyone (myself included) is going to do that. I thought I had a pretty good financial adviser, but then he got me heavily into high-tech stocks in 1999; good bye kids' college funds.
The simple mantra of investing is the stock market, at least when you are young. Just about anything else you'll be luck to keep pace with inflation. The simple mantra of stocks is: Buy low, sell high. Right now energy stocks fit that bill. I'd buy them if I had the cash, but only large established companies like Exxon/Mobile, etc. The small ones are likely to get wiped out soon.
Commodities also are a good buy right now such as copper
go talk to them about a diversified portfolio of Stocks and Bonds. Maybe some low-cost Vanguard products. Of course, after taxes and a 6 month emergency fund are taken care of.
GaGambler...
Consider the advice and then make your own decisions.
Don't rely on anything said here. I have used financial advisors over the years (still do) because I don't want to be a day trader. A planner will tell you to establish your level of risk tolerance and then diversify, which is pretty good advice.
Just remember that if financial advisors were as smart as they want you to believe they are, they would not have to work and would already be retired.
If you invest in the stock market there's an old saying and it's true so far as I can tell: Bulls make money, bears make money, pigs get slaughtered. This is probably true for any investing you may do be it real estate, bitcoins or whatever.
Be smart, don't be greedy, and good things should happen whatever you choose.
And living within or below your means is a great way to get started.
YES, MUST pay taxes to make your cash legit.
Yes, to Vangard.
Yes to rental property IF you have a handy streak & live close enough to supervise yourself... and the temperment to stay after things.
I hung onto my first house & converted it into a rental.
Mistakes I made: I didn't keep the rent up with the market. It was too far away from where I ended up living SO I didn't inspect o0ften enough. If I were to do again, I'd pick up the rent in person & walk though monthly. And hire a pro to do repairs... the tenant was in the repair business but work he did for me was half-arsed. do not let repairs slide... loss of rain gutters, cost me major repairs (rotted out sills).
Despite it all, 30 years later, I got a good payout. Did better than my IRAs over the same period.
Paper savings bonds... show up when you buy them... and again when you turn them in. In between there are no records, because you don't recieve the accumulated interest, so are invisible to student aid audits. This may be important to some & not so to others.
I agree, you need to leverage your position so when you want to leave the business you have the correct credentials to do what ever the next chapter in your life is.
invest in real estate. Buy property in a high demand area and rent it out to cover rent, taxes, etc.
As far as how to go about it, location, tax advice, all that other stuff, I'm sure there are people who you can ask for referrals to for advice in that area.
That is the number one thing people in finance have suggested to me - I have also known young ladies who've owned rental property and got good tax write offs / all the rent and were pretty financially secure.
I wouldn't invest in extremely expensive vehicles as they are a horrible investment.
...to a great start. If you decide to go into business, that discipline will serve you well.
If you go into business, it should be one that is already successful. It was once thought that 50% of new businesses fail in the first year and 95% fail within five years. The link below says it's not quite that bad but it's still a flip of the coin whether a new business will be successful.
You should buy a business where the product is in demand and not dependent on the personality of the current owner of the business. But you have to study the business and have a passion for that business before you make a commitment.
If you don't plan on moving from the city you're living in, you should consider buying a condo. You could be paying the same monthly payment as your rent and building equity at the same time.
So Vanguard is a thing I should look into it seems.. I've gotten a few pm's about it and a few have mentioned it in this thread so I will definitely look into that.
Real estate- I would love to purchase a home in the next couple of years, I'm not sure that I'm ready to take on the responsibility of home ownership right now.
Investing - I have no knowledge there, absolutely none. I would need to do lots and lots of reading and research to even have a minor idea about where to start with that. I would be willing to speak with a financial advisor, or someone at my bank (is that reccomended?) to get an idea.
Thanks for the advice everyone. I've been thrust into this new financial situation and figuring out what to do about it has been a pickle for me. Months ago I was making just 3k a month, so this is a big change for me.
Real estate ...
Investing ...
You can't plunk down $10k+ as a deposit on some real estate or transfer $10k+ into a brokerage account without generating a paper trail to the IRS or Homeland Security or some other agency. I think that some banks and financial institutions voluntarily report lower amounts.
(As a reminder, NY Governor Eliot Spitzer didn't get caught calling a number or making a date, he got caught for making cash withdrawals of around $5000 that his bank routinely reported to the fed agencies. They needed to know where that cash was going: terrorists? money laundering for a drug cartel? Nope! It went to Ashley and her agency! Busted!)
If you have your dough in a shoebox, stuffed in a mattress or in a safe deposit box, you will have to come up with a strategy to get it back into USABLE circulation. I strongly suggest doing it legitimately, even though you will lose some to taxes. If you get involved with money laundering or other crimes, you will suffer FAR worse than being caught in a hotel room with with your panties down.
I am just guessing, but maybe a CPA can chime in ... start moving your cash into bank accounts a few $k at a time, every few weeks
it as much as possible or do it carefully. 1st time real estate purchase do have a higher chance of triggering an IRS audit, but I have never experience any problem when I transfer money between my bank and my brokerage accounts ($10k+ or $100k+). I did experienced problem when I tried to withdraw $50k in cash (for Vegas). Don't start to deposit a few k if you are just starting out. Start slow with few hundred and vary your amount. You don't want to trigger a "structuring" alert. Odd amount is better (like $320, $435, $766, etc.). Once your account has few k, then you can start increasing your deposit. I hope you don't find it too troublesome. I guarantee it's less troublesome than facing an IRS audit or HS.
-- Modified on 9/2/2015 10:46:54 AM
Beware of PMs. They could be from scammers or "financial planners" trying to take advantage of you.
Real Estate: I have yet to see somebody come out ahead renting over the long term.
Investing: You are on the right track. Spend at least a year learning about investments. Take all advice from people who would make a commission (financial advisers) off you with a grain of salt. Reading books, researching investments on your own and even taking courses in investments is the way to go.
From the sound of it you have put yourself in a good position to build a nice financial future for yourself.
It will likely be a waste of time in trying to find someone good. If they are any good then you can't afford them. Just open an account at Vanguard (you can do it online) and start buying S&P 500 index mutual fund or ETF (with money that you won't touch for the next 3 - 5 years). $100k is really not that much so it shouldn't raise any red flag, but I assume you already have a bank account. You can easily write a check and deposit it into your new Vanguard account.
this year or next.
also do not buy gold.
nothing wrong with leaving it in savings account/ CD for a couple of years.
Once you are more learned on the subject you will have a better understanding of what to do.
work. Assuming you were in my age bracket and financial position what would you do? Advice from older men and women would be awesome! Thanks!
Very good point, impposter. Make sure legit money and account activity is extremely impotant.
For real estate, I doubt it works for most providers. How could you get a loan? Don't tell me you are going to buy a house with all cash.
Stock investing is very tricky, and it needs a long time to learn and practice. The most guaranteed way to make money in stock market is to make routine regular contribution to stock market no matter market is up or down, but that requires you to have fixed income that you can contribute regularly. For providers, that means you have to work hard meeting clients for many many years, maybe more than 10 years or more. Two years definitely not enough.
If you are asking how to turn 100~200k into 1~2 million in 10~20 years, that's a million dollar question. It's possible, but with significant amount of risk and no guarantee. Asking a financial advisor how to invest in stock market most of time is useless, because you can easily get the same answer from self education from internet. Depending on them to choose which fund you should invest is also useless, because most of the fund can't beat S&P 500 index in the long term.
I have been an enthusiastic stock trader for 17 year since I first came to this country. I am lucky that I survived through the IT bubble burst and the subprime crisis. With all these years of learning and experiene, I am confident and comfortable to do stock trading, it's very exciting and lots of fun. The theory is quite simple, but very difficult to follow in reality for most peoples. That's why most people just choose to stay with buy and hold strategy with routine contribution.
You are so young with 100k of saving, and you are smart enough to think about investing. If I were you with this money at your age, I will definitely learn investing, learn how to trade stock, options. You can do $100, $200 trading in stock options, its a lot of fun. It might turn out that it doesn't fit you. But It doesn't hurt to learn it. Be prepared that it takes a long time to learn. If you learn it, you will benefit for the rest of your life. So start small, learn and have fun. Don't put too much money in untill you know all the risk and know exactly what you are doing.
osted by eufool101:
"For real estate, I doubt it works for most providers. How could you get a loan? Don't tell me you are going to buy a house with all cash. "
If you have 100K cash, there are ways of doing it without conventional bank loans. Many areas have Real Estate investment clubs where she can learn.
The reason I did not recommend the stock market is simple. It can take a good five years (it took me 8) to learn the numerous esoteric strategies necessary to make real money in the financial markets. Most people who try trading stocks, bonds, futures, options etc fall flat on their face. Even the so-called "experts" seldom beat the market
and never beg to pay for sex...
Who is a licensed, knowledgeable person who has the ability to establish your portfolio and help you come up with a strategy to maintain a healthy and prosperous financial present and future.Typically the main strategy is diversification but that is something he/she will explain. As other have mentioned, and it is just a common sense approach:
Do not live above your means. This is one of the biggest mistakes people in this business make specially those who started a long time ago when things were way more active and easier. Because we do not really have a set income, it is best to keep expenses consistent as well as standards of living. You do not have to live under the bridge but living in a penthouse that you can't hardly afford is not the brightest idea either.
Invest on your education or try to learn new something constantly. You don't have to necessarily go all the way up with an MBA or a PHD but having a college degree helps in case tomorrow you want to have a real job or business knowledge, college is a great way to open your mind.
Pay your taxes. Nothing worst than trying to rent a place or buy a place in the future and not having a way to prove your income.
Find your passion in life and pursue your interests, so your life is full and more interesting. Some ladies make the mistake of getting caught up in the money trap, so they are sitting on money without any business ideas or something fulfilling to do. Do you like crafts? do your research and perhaps create something to sell at Etsy, do you like Fashion? set up a small clothing store on Instagram, do you love animals? find time to volunteer at an animal shelter.
Travel the world and see other cultures, I can't tell you how important is to be worldly and how many doors that will open you as well as make your personality flexible and easier to interact with others
I've used a lady for awhile now who's done a great job. Has all her licenses, degrees and is a CFP. It one makes a blanket statement like this, lots and lots of good, talented professionals are immediately eliminated. Is having a CFA designation nice? Sure. Absolutely necessary? Nope. Actually I've met a few CFA's along the way who don't know as much as my advisor does. Not even close. The rest of your advice I do in general agree with however.
I do hate to meet with my advisor however as she's quite hot. Quite hot. Drives me nuts.
Partially agree with you. Those CFA or professional financial advisor knows very little about stock trading. Their recommendations are no better than the recommendations you get from internet, and their recommendations and advise are all over the internet for free. In term of stock investment, I would rather put my money in S&P 500 index than listening their advice.
I do hate to meet with my advisor however as she's quite hot. Quite hot. Drives me nuts.
He's the smartest guy around so I wonder who he uses or if he just does it himself?
While I have some money in tracking funds and ETF's, Vanguard by preference, I still like the bulk of my retirement in managed funds or individual issues managed by a specialist. My advisor charges about 90 basis points which might seem somewhat high but I feel like I get my money's worth. And did I say she's hot
A CFP is more in order for what she needs. She needs someone who can help her understand her money and future scenarios. Keyword = scenarios because I don't think she has a solid plan yet. Scenarios can help her determine what her ROI needs to be to hit those future retirement goals so that she can do some reverse-like decision making and determine how much risk she needs to take on. Once she knows that, she can decide if she can afford to invest time and energy into a PhD vs something faster like flipping a house. Not to say that a CFA can't do this, but IMHO they tend to give very vanilla advice and aren't that creative investment-wise. I think that a CFP and someone with tax planning expertise is the best combo.
Of course finding an all-in-one is the dream, but is that even possible?
Knowing what she needs before diving in is best. That clears the fog for many and you'd be amazed how easy it is the decide what to do after providing when the fog is out of the way.
Anywho the lady already seems to have a good head on her shoulders. I'm very happy to see her post even without knowing who she is. I love proactive women.
Anywho the lady already seems to have a good head on her shoulders. I'm very happy to see her post even without knowing who she is. I love proactive women.
Not my area of expertise. Too risky for me lol.
You can Invest in stocks:
Very few fund managers have beaten the S&P 500 index in average annual returns. Personally picking a fund to put your money into and expecting it to grow at a decent rate is like gambling. Individually picking stocks is also gambling. You can instead allocate your money such that it mimics the S&P 500 index. You do this by investing in Vanguard index funds. You typically get around at least 7% a year.
I personally have some in an ETF that tracks the S&P, some that track the S&P but take more risk and some in an ETF that tracks the indexes of international markets. Having my money in just these 3 funds mean my money is spread around hundreds of stocks across various nations meaning I have cheaply afforded me a ton of diversification. Management fees are also dirt cheap as they dont have to do much but try and mimic the indexes. In a mutual fund you will be charged 1-3% management fee every year regardless if they make you money or not. In an index fund it is costs around 10x -100x less.
If you are going to hand pick stocks, pick companies you believe will still be here in 100 years. You do not get rich off of short term gains, you get rich off of consistent returns and something called COMPOUNDING which is essentially investing back your stock gains into the same stock. This is why Warren Buffet is so successful.
You can invest in real estate:
I do not recommend this. Everyone thinks a house is an asset but you have to constantly maintain it, pay insurance and pay tax on the property AND rent money from the tenants. The only lucrative areas in real estate is in developing or owning those huge rental complexes with hundreds of units. Flipping homes and condos is gambling.
You can start a small business:
I also do not recommend this. 80% of businesses fail within the first year and the remaining 10% or so slowly die within 5 years. However this route can offer the highest possible return on investment if you know what you are doing.
You can invest in a marketable degree or trade certification:
Accounting, Computer Science, Engineering, Law, Electrician, Welder, Plumber, Landscaper.
The bad thing about being a provider is the money is risky to invest since you have to wash it somehow first. Getting caught nets several years in jail and you will have to pay insane interest on the amount owed, something like 70% interest. I have heard some providers doing it by saying its from freelance writing. Find a good accountant and always make sure he or she is a CPA. Ask to see his or her certification. ANYONE can call themselves a tax professional even though they don't have a certification. There have been tax professionals who have kept the tax money from clients and just ran for it.
My best advice is to find a boyfriend with a stable job and you yourself find a stable job. Invest all proceeds from your two jobs and live off of your provider cash. Getting caught avoiding tax is no joke lol.
Good luck
I'll second this. Since you're putting money away for the long haul an index fund is an excellent investment. If you look at the linked chart you can see historically investment in stock is a great way to make some easy money. Just set it and forget it.
The answer to Index Funds is.... IT DEPENDS. No one really ever knows where we are on the chart until long after the fact... and we could easily be in a bad spot on the chart right now. This chart, indexed for inflation, is a great example of what I mean. The poor soul who invested in the market in the summer of 1929, and there were many, and did not get out quickly when they had the chance, may not have seen his money return in value, with inflation taken into account, until the late-50s/early-60... or perhaps even the mid-80s -- if he was not already dead by then.
I think diversification is the key to investing your nest egg... but remember that most investments do not go up in value in clean linear increments. I suggest that you find 2 or 3 fee-based or hourly-rate investment experts you trust who do not get paid a commission on what they recommend, and have each of them invest 1/2 or 1/3 of your egg. (And perhaps don't even mention the other/s to each of them...LOL.) BUT also closely monitor what they do, and don't invest in ANYTHING that they you can't understand. If any investment is so complex that they can't explain it or you can't understand it, then you likely won't be able to sell it to someone else later... so you don't want it, even IF it is not a scam... but it might be.
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You can invest in real estate:
I do not recommend this. Everyone thinks a house is an asset but you have to constantly maintain it, pay insurance and pay tax on the property AND rent money from the tenants. The only lucrative areas in real estate is in developing or owning those huge rental complexes with hundreds of units.
Wow, this is news to me and probably a million other RE investors
Very impressive.
If I were you, I would create a very realistic cash flow plan to make sure that whatever investments you plan to make are covered without you running into any liquidity issues down the road. Make sure that your cash on hand stays in a great position. Create tiers for your cash on hand such as "best case" "average" "redzone/danger." and keep an eye on it. Track it so that you know what causes you to go high or low.
The small business association is a great place to start with this. Plenty of self employed people that have to manage their personal income as well as business income refer to them. No they don't need to know how you have the money. But if you want to go into business for yourself, of course something outside of this, they will point you in the right direction to create a plan that will keep you financially healthy.
You can also take classes on personal finance or subscribe to personal finance blogs. They give lots of tips and often they state what good investments are out there. If I were you, I'd invest. Don't hide the money under the mattress. At your age, you need to be aggressive. I can't say what to invest in because you should target investments that keep your interest, but I'd be seeking to grow the money and I wouldn't wait until 2yrs to do so unless you are too busy to do so while providing.
With that much in savings at your age, your first priority is completing your education, and you should pay for as much of it now while and as you can. Make sure you are savvy enough financially to handle your own affairs...
In my company, when I was originally hired in the early '80's, many clerical jobs were available to HS grads, and good performance provided upward mobility. Not so today...no degree, no interview for someone her age. Simple as that. Although I'm not in the medical field, if that were her line of interest, I would advise getting a degree over a certificate in order to provide herself with maximum options. She has the income, and presumably the time to pursue these endeavors.
Also, I would advise any young adult to attain a level of competence financially so that they can handle their own affairs. That will require college level work, but it will pay off down the road.
College teaches you very little about how the real world of finance works, and in information age we live in, most of the skills you need can be mastered much more quickly on your own rather than learning in a class room. You would be amazed at how little most college grads have learned in college about the world of finance. Trust me I have hired plenty of them.
I will agree that the same can be said about these so called "Certified" financial planners. Most of these guys have the same level of financial expertise that can be learned by reading a couple of old copies of Money Magazine.
One piece of real advice I might give to the OP is to ask this question in person (without saying how much money you have) to some of your "rich" clients. Maybe one of them will "take you under their wing" and you can be more specific as to your financial goals.
Also, I would advise any young adult to attain a level of competence financially so that they can handle their own affairs. That will require college level work, but it will pay off down the road.
Graduating under the age of 26 (for a bachelors ) or having steady work experience in the field is what gives you upward mobility. A person 25 should think twice about getting an expensive degree. Graduating at 29 puts you 5-7 years behind everybody else and you have to look at the opportunity cost of the money. Otherwise you can end up with ungodly debts that you will be paying off for the rest of your life and still not have a high paying job.
For some people a professional certificate in a high demand field makes more sense.
Sorry to tell you but college level work (unless it's a finance major) does NOT prepare you to handle your own financial affairs.
1) $100,000 is not that much in the grand scheme of things, but is a good base if not touched and allowed to grow. If its your "emergency fund" (about $20k based on your monthlies) also, then its really not that much.
2)You are under 25. Do you have another career-and I mean career, not job that will replace all that income.
So based on that, my advice is to keep working as long as it makes you happy or until you can replace all that income. Of course at your age, marrying well is definitely another career choice.
work. Assuming you were in my age bracket and financial position what would you do? Advice from older men and women would be awesome! Thanks!
I'm thinking you've learned a few things about running a business and money management, so why not take the money you've earned and invest it in your own "legit" business: a restaurant, hotel, pet grooming store, or whatever it is you like to do.
I am not saying nobody should try, but everyone should knows the odds before trying.
The most important thing is to keep 6-9 months worth of expenses in cash in the bank for emergencies. In your case, maybe $20K.
Then:
1) You do not mention whether you have a college degree. If not, get one. If you have one already, go to graduate school. Starting off your post college life without the crippling debt so many of us have will be a blessing.
Choose a degree that will help you land a job. Accounting and/or finance are excellent choices. Nursing is good. Or hell, go to medical school or dental school! Become a pharmacist. Pick a career you will like.
2) Put some money in an IRA every two weeks. Buy index funds and let the money grow over time. In 30 years you will be all set.
3) Join an investment club. You will learn about stocks and investing, and you will start to build wealth that way. I can give you more info if you PM me and just tell me which state or city you live in.
4) If you plan to stay put for at least three years, buy a sensible house near the university and build equity. Do a conventional loan with 20% down.
5) If you want to start your own business, read "The Millionaire Next Door" by Thomas J. Stanley. (I can give you other book suggestions if you want them. Just PM me.)
Best of luck!!