What is the single, most effective piece of financial advice you've ever received?

[clatoden99]

Preferrably something that has had a notable impact on your life.

[Nutria]

"Live within your means."

All sorts of advice have been repeatedly given to support that one statement, so I'll give one hopefully unique bit: avoid commercials at all cost.

Why? Advertising agencies have spent hundreds of millions of dollars and employed thousands of psychologists to study human motivation so deeply and thoroughly that they could convince Hillary that Bill is a celibate monk. Convincing you that you need to open your wallet and spend spend spend because "you DESERVE a break today" is chump change for them.

We buy lots of DVDs & Blu-Rays, I rip them into h.264 and have a "WD TV" media player plugged into the the TV. That way, my family have a wide variety of shows/movies to watch, but no commercials.

[emilyliving]

Hi Everyone

The best advice i have received related to maintain your financial status is keeping check on your credit score.

I am hereby sharing some most basic moves you can make to maintain your credit score are as follows :

1.The initial step is to get your credit report and discover your genuine FICO rating and watch that the information hung on your report is exact.
2.Construct a decent financial record.In the event that you have no financial record then it's more troublesome for loan specialists to score you, so will probably be dismisses. Along these lines, for those with a constrained record, you have to fabricate one. We demonstrate to you best practices.
3.You should correct your incorrect information on credit defaults.On the off chance that the information on your credit report document is off base,this can be updated to improve your report and score.

[bjl584]

Pay yourself first.

That alone forced me to invest and save BEFORE I did anything else with my money.

[MonkeyMama]

Don't go into debt for anything but a mortgage. (Mortgage was excepted because we live in California). I imagine this has saved us a bajillion dollars over the years and has put us on the track for early retirement. Is also why my spouse does not have to work.

This is also just another way of saying, "Live within your means." You have to live within your means if you don't entertain debt as an option.

[dawnwes]

You can wait for something, and save up cash to buy it.

[Fishindude77]

Get your azz out of bed and go to work !

[parafly]

Start saving for retirement as early as possible.

The power of compounding interest over time is tough to grasp without concrete examples. Assuming an average rate of return, if you save $5000 a year from age 25 to 35 then stop completely, you will end up with more savings than if you save $5000 a year from age 35 to 65. The early years are key!

[Weird Tolkienish Figure]

I had a bunch of debt build up: student loans and credit cards after school was finished. Plus I was living in Boston on a meager salary. In 2004 I found Dave Ramsey's "The truth about debt" article over the internet. Completely blew my mind and changed the way I looked at debt. I don't agree with everything the guy says, but his article changed my life for the better.

I never listened to his show or followed his advice exactly but the article gave me the outline for my financial future: didn't buy brand new cars, avoided consumerist mentality, paid off CC's and student loans, got a health emergency fund, and got a respectable 401k.

I particularly liked the quote about the borrower being a slave to the lender.

I've slackened a little since then as my salary has gone up.

[Nutria]

Dave Ramsey's "The truth about debt" article over the internet.

https://www.daveramsey.com/blog/the-truth-about-debt/

Truth: Debt isn't used by wealthy people nearly as much as we are led to believe.
The myth has been sold that we should use OPM (other people's money) to prosper.

Hogwash. This financial "expert" seems to have never heard of arbitrage.

[FLA]

Pay yourself first.

That alone forced me to invest and save BEFORE I did anything else with my money.

me, too. Start investing as soon as you get your first job out of school and do not stop even when the market is down, be in it for the long haul

[LivingAlmostLarge]

Pay yourself first. When we started making real money the budget started off with retirement and savings. Then we determined what we could "afford" in a home/rent. Everything else fell into line after we saved what we deemed necessary. Turns out it helped long term.

[jay_rogers]

Saving Advicve

"If you want anything badly and have passion, you will find a way to get it."

[Nutria]

Pay yourself first. When we started making real money the budget started off with retirement and savings. Then we determined what we could "afford" in a home/rent. Everything else fell into line after we saved what we deemed necessary.

See, I disagree with that.

Find a nice (in the old fashioned, modest sense of the term, not in the new "nice == expensive") residence in a nice neighborhood, and let that drive everything else.

What really drove our retirement planning was that public schools here are really bad. So, 24 "child-years" of parochial school tuitions hang heavy over our budget. And have you priced auto insurance for teenagers???

[LivingAlmostLarge]

Nope pay yourself first absolutely is the way to go.

Example $100k income first job.

Say you say I have to save 15% to retirement, then you say you have to save 5% for short term and 5% long term. There is 25% gone.

You have $75k left for taxes and living. Knowing that's what you have to live off of how would you budget?

If you say that saving is never ever negotiable you'll have always set yourself on the track to succeed. It will drive all decisions including the most expensive one "buying/renting" a house. It will force you to look at your finances after you've saved.

Sometimes honestly even a modest house is TOO MUCH HOUSE for certain incomes in certain locals. So housing should not be the driving force in any budget.

Savings should be. I've lived in HCOLA always until now and if we let housing drive our budget we'd be broke. Modest was living in a condo/townhouse with two kids and no garage. Most people's modest where I was a 3 bd/1 ba cape that started around $800k.

NO you can't afford modest. You can barely afford $500k for a 2 bd condo if that. So saving needs to come first on any budget and any location.

When you let "housing" dictate you'll always find excuses to not save. I have to save for a house, car, paying off debt. I know TOO MANY people everywhere I lived who are in their 30s and haven't started saving for retirement because they were too busy saving for a house, paying off student loans, etc.

Truth is you need to start saving and make it a budget line item then pay off your debts then that's what you get to live. Too many people do it backwards and savings is just something that happens.

Um starting at the 401k at 1% and increasing it ever year. I challenge what happens if savings came first and people learned to live on what's leftover? I think it's better than not saving, but mindset that you have to have a house needs to change as well.

Both DH and I were raised this way and our parents paid off homes in less than 15 years, substantial retirement accounts, and extremely financially secure. The question I've always heard is "can we afford it on what we make?" Only after we've hit all savings goals.