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1) Pay myself first
set up direct deposit, allocate 5% to savings, 5% to emergency funds, 15-20% to Roth IRA & Roth 401(k)
Health savings account (HSA)
Contribute $100 to $300 monthly or max it out for tax advantages
2) Fixed expenses
Keep fixed costs low. Aim for fixed expenses to be less than 50% of your pretax income
3) Living arrangements
Stay home or get a roommate. After college consider living with family or a roommate to save 10-30% of your paycheck towards a home down payment
4) Emergency fund
Save for 6 months of expenses
5) Budgeting
50/25/25 rule- allocate 50% to your needs, 25% to funds, 25% savings and investing
6) Investment Portfolio
Adjust with market conditions. Create an aggressive portfolio with large cap stocks- S&P 500, tech stocks- QQQ, and use dollar cost averaging
Bonds; consider short-term bonds as a defense strategy during market downturns
Alternative investments; begin learning about and investing 2-5% of your portfolio in alternative assets like cryptocurrency (ex: Bitcoin, Solana) to diversify & explore more growth opportunities
7) Employer retirement match
Maximize retirement contributions; take full advantage of your employer’s match and aim to get fully vested in your retirement plan
8) Debt management
Credit card and loan payoff; pay off my credit cards monthly and accelerate debt payoff by making biweekly payments or adding to the principle
9) Insurance planning
Execute disability, health, life (group or term), home, car (minimum full coverage), dental vision
Long-term care, use an HSA for long term care needs
Umbrella insurance - add when your net worth exceeds the equity in your primary home plus your total retirement funds or if you have significant assets at risk
10) Tax efficiency and Business ownership
LLC for the tax benefits; consider starting an LLC to reduce taxes and create passive income streams through side hustles
Passive income ideas - real estate investing, dividend stocks like PM, SCHD, affiliate marketing, vending machines
11) Mortgage Strategies
First time homebuyer opt for a 7/1 arm
Subsequent homes, use a 15 to 30 year mortgage but accelerate payments to save significantly on interest
12) Car and Student loan payoffs
Car loan payoff in 3 years, most economical to buy a car with 30k-40,000 miles and 3-4 years old
Student loan, aim to pay off in 5 years
13) Education savings
Open a 529 college savings plan for tax-free growth to fund children’s education
14) Prenuptial Agreement
Protect your investments, consider a prenup, protect assets, and streamline divorce proceedings
15) Retirement Growth
Debt-free retirement - pay off everything
Withdraw 4-5% of your retirement funds annually
16) Home equity line of credit (HELOC)
Use HELOC if market drops more than 20% unexpectedly and use for home improvements
17) Estate planning essentials
Key documents - will, trust, power of attorney health & finance, letter of last instructions
Beneficiaries; regularly update beneficiaries on all accounts, especially after major life events
18) Social Security
Plan to take social security benefits at age 67
19) Visualization and positive affirmation
Visualize and manifest your dreams often
Say positive affirmations, reinforce a positive mindset about money and your passion by repeating affirmations such as
Money flows into my life effortlessly
I am good at making money
20) Personal growth
Expand your knowledge with books like The Millionaire Next Door and Rich Dad, Poor Dad
21) Surround yourself with likeminded individuals
Share what you have learned with family and friends. Teaching reinforces your knowledge and spreads financial literacy
Compounding is so important! The secret to wealth. Time is the most powerful tool for building wealth. Compounding turns small, consistent actions into extraordinary outcomes over decades
