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Started By
Message
Teen needs investing advice.
Posted on 6/15/23 at 8:13 am
Posted on 6/15/23 at 8:13 am
My regular barista is 19 and saves her money. She doesn't know many professional people so asked me how she should invest. I thought it would be a good question for the Board.
8
Posted on 6/15/23 at 8:57 am to prplhze2000
Posted on 6/15/23 at 9:04 am to prplhze2000
Tell her to open a vanguard brokerage and make regular contributions to VTSAX. If she does even $50-$100 monthly contributions, she will be in a very good spot by the time she's 30.
She could also open a traditional brokerage acct and do the same thing in $SPY.
Consistent savings and time IN the market is all a 19 year old needs to worry about.
ETA: Also, encourage her that the fact she is saving and curious about investing at 19 puts her LIGHT YEARS ahead of her peers.
She could also open a traditional brokerage acct and do the same thing in $SPY.
Consistent savings and time IN the market is all a 19 year old needs to worry about.
ETA: Also, encourage her that the fact she is saving and curious about investing at 19 puts her LIGHT YEARS ahead of her peers.
This post was edited on 6/15/23 at 9:06 am
Posted on 6/15/23 at 9:21 am to prplhze2000
Most important is spend less than you make! Sounds like she is off to a good start.
Invest. Have initiative to get in the game. An investor will win some and lose some over time. Fear of losing causes too many to let years go by without using their money to make more money.
Split investments between index funds and individual stocks. I started my kids/grandkids on low cost s&p 500 etf and Nvidia. Added Apple, Waste Mgmt, and more s&p 500 for them later. I included Waste Mgmt in particular to teach them that it does not need to be about the latest shiny thing. Teaching to "get rich slow" is what I am doing for my family. The world is not crypto or bust.
Once she builds enough assets, learn about real estate investing for a good diversification.
Invest. Have initiative to get in the game. An investor will win some and lose some over time. Fear of losing causes too many to let years go by without using their money to make more money.
Split investments between index funds and individual stocks. I started my kids/grandkids on low cost s&p 500 etf and Nvidia. Added Apple, Waste Mgmt, and more s&p 500 for them later. I included Waste Mgmt in particular to teach them that it does not need to be about the latest shiny thing. Teaching to "get rich slow" is what I am doing for my family. The world is not crypto or bust.
Once she builds enough assets, learn about real estate investing for a good diversification.
Posted on 6/15/23 at 9:26 am to Brobocop
quote:
Tell her to open a vanguard brokerage and make regular contributions to VTSAX. If she does even $50-$100 monthly contributions, she will be in a very good spot by the time she's 30.
She could also open a traditional brokerage acct and do the same thing in $SPY.
Consistent savings and time IN the market is all a 19 year old needs to worry about.
This is great advice
Only change I would make is that instead of opening a brokerage account first, I would make sure she takes advantage of all her tax advantaged accounts.
Opening something like a Roth IRA at her age, would be a very good move. That way her gains will be tax free. Only after exhausting the tax advantaged accounts do you open a brokerage.
Posted on 6/15/23 at 9:29 am to prplhze2000
Man, I wish I was 19 and knew what I know now about investing. That's awesome.
VTSAX and chill is great, easy advice.
I'm 43. The most important thing I would teach to my 19 year self is to get $100,000 saved as quickly as possible. Compounding just hits harder when you have six figures.
I hit that at 33. A smarter version of me could have hit it at 25. At 43, I regularly see days where I hit my monthly salary and months where I have hit my annual take home pay. Keep reinvesting.
VTSAX and chill is great, easy advice.
I'm 43. The most important thing I would teach to my 19 year self is to get $100,000 saved as quickly as possible. Compounding just hits harder when you have six figures.
I hit that at 33. A smarter version of me could have hit it at 25. At 43, I regularly see days where I hit my monthly salary and months where I have hit my annual take home pay. Keep reinvesting.
This post was edited on 6/15/23 at 9:32 am
Posted on 6/15/23 at 9:42 am to prplhze2000
What's the life aspiration? Is school in the future? An increase in earnings?
Posted on 6/16/23 at 10:13 am to Thundercles
“19 and saves her money”
Where is this?I’d like to send my 20 y.o. grandson there to meet her.
It’s really very impressive a 19 y o has that much sense.
Where is this?I’d like to send my 20 y.o. grandson there to meet her.
It’s really very impressive a 19 y o has that much sense.
Posted on 6/16/23 at 12:37 pm to prplhze2000
ROTH IRA and a Index Fund
Posted on 6/16/23 at 8:21 pm to prplhze2000
Roth IRA and VOO
Posted on 6/16/23 at 8:37 pm to Grinder
Start early and diversify. Buy the market thru Vanguard and never touch it. She won't be sorry.
Posted on 6/17/23 at 6:25 am to hottub
quote:
ROTH IRA and a Index Fund
If there was a young person I cared for and who had income to make them eligible for a Roth, I would fund it for them. Just a few thousand bucks in their 20s will be enormous, tax free, in their advanced age.
Set it and forget it.
S&P 500: $1,000 in 1990 ? $20,455 in 2023
Posted on 6/18/23 at 9:28 am to Brobocop
What’s the best way for her to go about it?
Posted on 6/18/23 at 9:33 am to prplhze2000
quote:
My regular barista is 19 and saves her money. She doesn't know many professional people so asked me how she should invest. I thought it would be a good question for the Board.
She should be investing all her time, resources and energy into herself and markedly increasing her earning potential.
She's not going to save her way to financial freedom on a baristas wages.
Posted on 6/18/23 at 3:09 pm to MrSpock
^^^ This ^^^
While I agree that she should open some sort of retirement account at a brokerage and first start with index funds as she learns about investing, I agree even more that she needs to be focusing on building her earning potential. As another said above, what are her career goals or aspirations? Is she in college or a trade school?
What she’s doing now is fine at 19. If she’s still doing that at 25… not so much.
While I agree that she should open some sort of retirement account at a brokerage and first start with index funds as she learns about investing, I agree even more that she needs to be focusing on building her earning potential. As another said above, what are her career goals or aspirations? Is she in college or a trade school?
What she’s doing now is fine at 19. If she’s still doing that at 25… not so much.
Posted on 6/18/23 at 3:35 pm to Twenty 49
quote:
If there was a young person I cared for and who had income to make them eligible for a Roth, I would fund it for them.
I do this for my kids.
Even when they had W2 in high school.
Doubling time at 7.2% return is 10 years. When you start at 16, you get more doubling times.
For me, at the last of my career, even maxing all vehicles cannot touch the amount that they will get from Roth from first job forward.
Posted on 6/18/23 at 6:02 pm to Brobocop
quote:
ETA: Also, encourage her that the fact she is saving and curious about investing at 19 puts her LIGHT YEARS ahead of her peers.
There are a lot of kids into trading/ gig economy/ because they heard about get-rich-quick schemes.
I have heard several that I thought were years ahead of their peers. It could also be market top?
Once the wealth effect gets taken out of the equation and she is still DCAing VOO then I'll concede she is probably marriage material.
Posted on 6/18/23 at 6:16 pm to Jag_Warrior
She is in college.
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