Financial information that every guy should know?

NGGYUNGLYDNGRAADY · 2014-09-03T17:30:12+00:00

I'm a financial advisor and used to be a mortgage banker. Feel free to ask me anything. Here are some basic tips...

Mortgages: If you're going to buy a house it's ideal to put 20% down for the down payment. If you can't do that, don't bother buying a house. On top of that, you should have 12 months worth of total monthly obligations saved up in addition to your down payment. There are a shit ton of other tips but when making such a large commitment, you want to make sure you're prepared when shit hits the fan because it often does. And never under any circumstances miss a mortgage payment. If you're 30 days late on a payment you could potentially fuck yourself over for several years from refinancing to a lower interest rate. Live without electricity for a month if you have to but pay your fucking mortgage payment.

Retirement savings: Start contributing towards a Roth IRA as soon as you turn 18 and never stop contributing. Always try to max it out ($5,500) every year. If you have an employer who matches 401k contribution, max that shit out. Chances are you're not contributing enough towards retirement. Start contributing more.

Insurance: not my expertise.

General advice. No matter what the debt is, always pay off the highest interest rate first and work your way down.
Don't go into debt unless you have to. Want to buy a new car? First of all, don't. Always buy used. Second, if you don't have the means to buy it outright in cash, why are you buying it? Don't buy a car because you want a car, buy a car because you need a car. Current car works perfectly fine? FUCKING KEEP IT.

Renting an apartment isn't always a waste of money. It depends where you are in your life. Is it likely that you found your dream job, signed a contract for employment rather than being an "at will" employee and know this is where you want to spend the next 10 years of your life? Yes? Buy a house. No? Rent. Rent allows mobility which is great if you don't want to be chained down.

Save save save save save your money. Relative died and you inherited $100k? You should never say "what should I buy" you should say "how can I invest this?" Chances are you're likely going to see a return of 5-8% in the stock market. If you have loans higher than what you can return, pay the loans off first, then invest money. However, it's generally a good idea to always invest a little of your money like ~10%. You never know if the market is going to have a massive gain like we saw last year. I think it was something like ~37%? Idk.

TLDR; don't be a fucking idiot with your money. Live frugally. Don't spend money on your girlfriend. And SAVE.

lonGterMgoalS · 2014-09-03T15:01:46+00:00

Not joking when I say this but for quick basic info look into "Idiot's guide" books. I hate reading about shit that doesn't interest me and these books come in handy.

Now if you are wanting more than the basics then take a class. My brother in law took real estate classes. Not because he wanted to be an agent but because he wanted to buy property. He took an accounting class so he could handle his finances. This kid has taken so many fucking classes and it's paid off. He owned (and still does) prime real estate in NYC before he was 30.

The kid is worth millions and he never went to college. He just took a bunch of weekly courses.

tombreck2 · 2014-09-03T14:27:22+00:00

Albert Einstein — 'Compound interest is the eighth wonder of the world. He who understands it, earns it ... he who doesn't ... pays it.'

If you dump $10k into a 401(k) with 10% interest in 25 years it will be worth >$100k and will be making >$10k per year.

Title	Financial information that every guy should know?
Author	[deleted]
Upvotes	5
Comments	17
Date	September 3, 2014 2:03 PM UTC (11 years ago)
Subreddit	Posted in /r/askTRP
Original Link	https://old.reddit.com/r/asktrp/comments/2fcv4y/financial_information_that_every_guy_should_know/
Archive Link	https://theredarchive.com/r/askTRP/financial-information-that-every-guy-should-know.141847 https://theredarchive.com/post/141847

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