Time is the most valuable commodity in our life. For your financial success, starting early is the best decision you can make. Regardless of your age, it’s always a good time to start planning for financial success. For those young 17/18 year olds just entering the military, the future is limitless. Here are some quick steps to start right now (complete in order listed).
· Establish an emergency savings account. $1K-10K depending on how much bills you have (no more than 6 months’ worth of bills saved)
· Reduce/eliminate debt. Reducing or eliminating debt is the bed rock of financial success.
· Max out available tax-sheltered investments. Start an IRA and max it out. If you have additional funds, consider starting your Thrift Savings Plan (TSP). I usually don’t recommend saving all your money in retirement savings because you should have short- and medium-term goals you will need to save for.
· After the IRA is maxed out, then start saving more in a taxable accounts or max out your TSP. Start investing in everything after you have an emergency savings account established, your debt is reduced/eliminated, and you’ve started saving for retirement. Buy stocks, mutual funds, gold and houses.
I enlisted in the military at 17 with no prior financial knowledge, absolutely no money and only two or three pairs of clothes. In the beginning, there weren’t as many resources available for me to learn from and I paid a lot of fees. But the banking industry has changed and information is available 24/7 and fees have been significantly reduced. After 15 years in the military, and following the steps above, I now have zero debt and have a significant amount of money saved up. I started from the bottom and now I’m here. At my 10-year mark, I crossed over to the “dark side” and became an officer. I hope to retire when I’m 40-years old. I’m not going to lie and say it was easy, but it’s worth it. It’s hard to see your friends spending all their money right away and having nice clothes, nice cars and a big house. But time can be just as cruel and it can be rewarding and after 15 years, I’ve seen time catch up to the big spenders and take everything away.
While blogging, I’ve met a junior enlisted, military-finance blogger, who’s well on his way to becoming financially secure. His investing style is focused on dividends. At the end of his military career and all the reinvested dividends, he will have no problems in the retirement years. Like his blog title states, he’s starting from bottom and he’ll soon be here. Go check out his blog and watch his net worth sky rocket: www.startingfromzeroblog.com/
There’s no reason you can’t do the same. Start today!
Thanks for the mention Brandon, appreciate the support sir!
ReplyDeleteAlso great advice for those starting out, I wish more people used it. I see way too many fellow junior enlisted members that don't take advantage of programs like the TSP while they're in. With such low fees, it's a no-brainer type investment, especially if you're not into picking your own stocks and actively managing your retirement funds.
Regards,
SFZ