How we start our journey into adulthood can often set the course for the rest of our lives, so it’s important that we make good decisions from the very beginning. The problem is that so many of the financial issues facing us at that age are completely new and we don’t know how to make wise decisions. On top of that, we’re surrounded by bad advice in society and the media. For example, the popular advice in our society is to live it up in our 20s and get serious about our money once we turn 30. Unfortunately, this is leading young people down a road that is setting them up for all kinds of problems.
The following recording is from “Mornings with Kelli and Steve” on Moody Radio Indiana (97.9 FM). For more information on Moody Radio, go to moodyradio.org/indiana.
Today, we want to discuss financial advice for young people entering this brand new time of life and we’re going to do this by looking at four key areas:
1. Money – Live below your pay grade for a few more years and delay some gratification.
Most college grads are used to sharing space, eating cheap meals and driving an older car. Suddenly, they get that first full-time job and start making more money than they ever have before. The temptation will be to buy a newer car, live in a nicer place and do all the things they couldn’t afford to do before. However, one of the best decisions is to enjoy a little bit of that pay raise while continuing to live as cheap as they can for a few more years. That may mean they keep driving that older car and hold off on expensive travel for now while doing something more important with any extra cash, such as:
• Aggressively pay off student loans – You’ve just spent several years taking on debt, so start working now to get yourself back out of it.
• Pay off all other debts and build an emergency fund – Life is going to throw unexpected things at you and you need to be prepared to survive without relying on debt. This is also good preparation for buying a home or starting a family in the future.
• Save for retirement – This is usually the last thing on a young person’s mind, but is often a regret of people nearing retirement. Saving during those early working years could make all the difference in being able to retire at a reasonable age. Simply start saving something and try to get your full company match if possible.
2. Perspective – Find contentment apart from money, material possessions and pricey experiences.
Hebrews 13:5 – “Keep your life free from love of money, and be content with what you have, for he has said, “I will never leave you nor forsake you.”
With new income comes new temptations to buy material things and have exotic experiences that we believe will make us happy. My wish for all young people is that they could understand the futility in looking for happiness in possessions before they ever start down that road. The world is selling us joy in a box, but we need to realize that money never brings lasting happiness.
This worldly idea of living it up in your 20s starts young people down a path that is so destructive. It not only develops a taste for expensive possessions and experiences that won’t be easy to stop. It also often leads to a pattern of using debt to pay for them that digs the hole deeper and deeper.
Giving is a natural enemy of materialism and self-gratification. It forces us to sacrifice our own personal desires and focus on something other than ourselves. It also serves as a reminder that every penny we have is from God. The habit of giving is easiest to develop when we start giving out of our first paycheck.
3. Advice – Surround yourself with wise counsel that can give you good advice.
Proverbs 12:15 – “The way of a fool is right in his own eyes, but a wise man listens to advice.”
We all need advice and it’s the fool who doesn’t seek it. Young people need to avoid the temptation to figure things out on their own and also to seek counsel only from other people their age. Wisdom normally comes with age and experience. All we need to do is look at the foolishness of Rehoboam in 1 Kings 12 to see what happens when young people ignore the counsel of the wise and trust the opinions of their friends.
Be willing to work hard seeking out wisdom from others and following their advice. No matter how lost you may feel or how hopeless your situation may seem, God has you there for a purpose and you need to surround yourself with godly people that can walk you through those difficult times and help you grow.
4. Work – No matter what work you are doing, do it to the best of your ability.
Colossians 3:23-24 – “Whatever you do, work heartily, as for the Lord and not for men, knowing that from the Lord you will receive the inheritance as your reward. You are serving the Lord Christ.”
Just going through the motions at work is not only a monumental waste of time, it’s disobedience to God. When you fail to do your best, you are stealing from your employer, wasting your time, and tarnishing the image of Christ to those around you.
Even if you hate your job, use your time to learn everything there is to know about that job and build relationships with those around you. I would also challenge you to view your work from the standpoint of the manager or the owner. This will help you understand the business and see things through the eyes of those above you. Every job provides you with a learning opportunity. Even if you need to start with a job that’s not your dream job, the work that you do and the lessons that you learn can help prepare you for the next step in your career.
Brad Graber, CFP® has been working with clients on personal financial planning and investment issues since 1996. He invests his time mentoring and educating individuals on ways to be better stewards of the resources God has entrusted to them.