Finances

I'm halfway through writing a post about Myers Briggs personality types. I'm pretty psyched about it, but I'm too P (can't get through stuff! ...you'll see). I figured I would refresh myself by writing a post about something that's been on my mind this weekend - finances! Yes, that is a positive exclamation point. There are many reasons to be excited about finances if you manage your money wisely.

I want to say something about this because I know a majority of you readers are around my age. I read Dave Ramsey's book Financial Peace Revisited this weekend. The most attention-grabbing thing I learned is how few people manage their money wisely, or start managing their money at all while they're still young. You might wonder why it's important to start thinking about your budget, savings, retirement now. You're young, you just got a job, you just got married. Well, since that's where you are, let me introduce you to your new best friend - compound interest! 

Because you're young, now is the perfect time to start saving. For example, Johnny invests $2000 per year for 8 years starting when he is 19 years old. Susie waits until she is 27 and invests the same $2000 per year, but for 32 years. Both have a 12% interest rate, and both save until they are 65. Who do you think has more money? Susie comes out with $1,532,166 - pretty good, huh? Well, little Johnny is sitting on $2,288,996. Susie has nowhere near as much as Johnny! 

Now, this isn't to depress you if you haven't started saving, it's just to encourage you to start now, however old you are! Particularly, if you have a retirement account, FUND IT!! Only one-fourth of people do. Good luck having retirement savings if you're not putting any money towards it! Again, you might think, hey I'm only 23, it's too early to think about retirement. Look back at that compound interest example my friend, now is the time to start.

Another key important factor that any financial adviser would give is to get out of debt. The sooner you pay off those student loans, the more you can start saving. The Dave Ramsey book was pretty good, but very opinionated and a little more secular. An excellent book on budgeting is the Crown Financial Ministries book, Your Money Counts. It is soaked with Biblical principles and overflowing with scripture. It's incredibly simple and easy to understand, especially if you know nothing about finances! Both books have excellent debt reduction plans.

Just wanted to be an encouragement and share what I learned since most of us recent college grads are kind of oblivious to this big world around us. Before you do anything, read one of those books (I am not a professional! Don't take my advice...figure it out for yourself). If anyone older and wiser out there has any wisdom to share, feel free! :)