For my Genius Hour project I wanted to get an outside perspective from someone I know. For this part of the project I decided to talk to my Dad about some financial advise he wishes he would have had when he was a kid. I talked with my Dad on the phone for about 15 minutes and we discussed several aspects of my project. The main highlights covered financial mistakes he made, things he thinks young adults should know about investing, and the importance of investing early.
One of the aspects of the interview I thought was very interesting was my Dad talking about some things he wishes he had known when he was younger. One thing we discussed was the first car he purchased. Right after college my Dad decided he wanted to upgrade from the car he had driven since he was in high school. He finally had some disposable income and decided he could afford to do it. What he regrets is that he sold shares of stock he had purchased to afford his down payment. This was a poor financial decision he wishes he had been given better advice about as stocks are an investment that normally appreciate in value while a car immediately looses value upon purchase.
We also discussed some other investment advice young adults should have. One major thing my Dad recommended was to just stay informed. A big part of accumulating wealth and saving money is to know how to invest. Keeping up with financial news is an important part of that. We discussed how much information is readily available these days for investors. It’s very easy to spend 20 minutes every day reading the Wall Street Journal or following twitter accounts that provide information about public companies to invest in. Creating these habits as a young adult can go a long way and greatly improve your ability to be a smart investor down the road.
Finally, I asked my dad about his opinion on investing early. He said it’s obviously a smart thing to do, but also not something to stress about in your early 20’s. As a college student there’s just no real way for you to earn and save enough money to dramatically affect your future. He did stress the importance however of when you start working to take advantage of your 401k and any employer matching. Investing in that early especially if your employer matches at a 50% rate can go a long way to helping you save money for retirement.