Hit the pavement. Just go and submit your resume in person. Get out there and shake some hands, why don’t you?
We’ve all heard these pearls of financial wisdom from our parents (and not always because we asked them to). Despite their best intentions, many of this advice from our elders is, well … out of date. To say the least.
Here are six tips from our parents that just don’t apply to us anymore, and some smarter choices.
1. Work your way through college
Working at the university used to be an option, when tuition cost a reasonable amount. However, that was a long time ago.
Enrollment at most colleges has easily doubled or tripled since the 1980s and 1990s. Working a job while attending college can help you pay the bills, but it won’t pay for college. That is why many of us are burdened with student loans.
Once you graduate, refinancing could help you pay off your loans faster and save money in the long run. By combining multiple loans into one, you will replace your federal and private loans with a single private loan.
In addition to simplifying the payment process, refinancing can lower your interest rate and lower your monthly payments.
2. Keep your money in a savings account
Here’s a standard tip for parents: Open a savings account. This is the best way to save money.
Yes, Ok, penalty fee. The problem is, with interest rates so low, a savings account these days will pay you practically zero interest. You can also keep some cash under the mattress.
However, a debit card and digital account called Aspiration allows you to earn up to 5% cash back and up to 16 times the average interest on the money in your account.
It’s not bad at all! You just have to adapt to the times and move beyond using a traditional bench.
Enter your email address here for a free Aspiration Spend and Save account. After confirming your email, securely link your bank account so they can start helping you earn extra money. Their money is FDIC insured and they use military grade encryption which is nerdy language for “this is totally safe.”
3. Always buy a house – it’s a great investment
This is an old but good. I can still hear my parents: Why are they still renting? When are you going to buy a house? It is a great investment!
The problem is, buying a home isn’t for everyone, especially with home prices so astronomically high these days.
It’s easy to make a compelling case for either option. Tenants don’t have to worry about the housing market or mortgages; buyers get tax breaks and a way to invest in their future.
There is no right answer, because every financial and life situation is unique and people’s priorities change over time. Where you plan to live, and how long you plan to live there, is an important factor in determining whether it makes more sense to rent or buy a home.
4. Buy savings bonds
What are savings bonds? You may remember them as something boring that your grandparents used to give you for your birthday.
Savings bonds are an old-school, very low-risk type of investment. Most savings bonds bear interest for 30 years. But the problem is, they won’t really make you a lot of money. For example, Series EE bonds have a low interest rate of 0.1%.
These days, it is better to invest your money in stocks. Sure, the stock market can be a bit volatile, with stock prices going up and down. But historically, investing in the stock market will give you a 7% profit over time.
Whether you have $ 5, $ 100, or $ 800 to spare, you can start investing with Robinhood. Both beginners and investing professionals love it because it does not charge fees and you can buy and sell stocks for free, with no limits. In addition, it is very easy to use.
What is the best? When you download the app and fund your account (it doesn’t take more than a few minutes), Robinhood deposits a portion of the free shares into your account. However, it is random, so the shares could be worth between $ 2.50 and $ 200, a good boost to help you build your investments.
5. If you don’t have a degree, you will never find a job.
Sure, many careers require a college degree. But many jobs don’t. Higher education is not for everyone, and there is no law that says you have to rush into college.
Did we mention that college is very expensive now? Student loans are a huge burden. Americans collectively have $ 1.5 trillion in student debt. Graduates with student loans generally owe between $ 20,000 and $ 25,000, and at least 20% of them are falling behind on their payments.
There are other options. For example, have you considered accounting? You could earn up to $ 69 an hour starting your own accounting business, according to Intuit, the creator of QuickBooks.
You don’t have to be an accountant or good at calculus to be successful in accounting. As long as you’re motivated, a company called Bookkeepers.com will teach you everything you need to know. It is one of the leading training courses in the field and even offers you the first three classes for free.
He has helped thousands of people launch their own businesses, including Daniel Honan, a military veteran and former painter. He signed up for Bookkeepers.com and now makes $ 50,000 a year. It only took him three months to get started, taking one class a week. Oh, and he makes his own schedule.
If you’re just a little curious, just submit your email address here to take the free first class. If you keep it, you could have your own business in a few months.
6. Rely on Social Security and pensions for your retirement
First of all, you probably don’t have a pension. Most pensions no longer exist, unless you work for the government.
You also shouldn’t be completely dependent on Social Security for your retirement. Social Security is designed to be a supplement, not all of your retirement savings.
To retire comfortably, you must consistently funnel a healthy percentage of your salary into a 401 (k) account; it is literally one of the smartest things you can do for your future. And if your employer matches each contribution, that could mean hundreds of thousands extra dollars in your account when you retire. It’s free money!
But if you can’t take advantage of this employer benefit because you need all of your paycheck every month, a company called Lendtable will give you the cash.
We know it sounds too good to be true. But if your employer has a 401 (k) matching program, this is money that has already been allocated to you. By using Lendtable, you will be able to unlock that money for free.
Let’s say you make $ 50,000 a year and your employer matches your 401 (k) contribution by up to 4%. If you deposit $ 0 into your retirement account this year, you will receive $ 0 from your boss. If Lendtable gives you 4% of your salary that your employer is willing to match, you receive $ 2,000 from your boss, minus Lendtable’s share of the profits. (This comes from the extra money you have earned, so there is no sacrifice on your part.)
It takes three minutes to answer a few questions about your eligibility and sign up for an account.
Once you have obtained the full matching amount from your employer, Lendtable will take the money they loaned you, plus a small portion of your earnings. If your retirement account provider applies a penalty for withdrawing money, Lendtable will cover that too.
The risk to you is basically non-existent, so not taking advantage of your employer’s combination with the Lendtable offer would make Future Millionaire You bow your head in shame. Start here.
Mike Brassfield ([email protected]) is a senior writer at The Penny Hoarder. His father gave him some good financial advice: “Never bet against the house.”