Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Stop thinking about it. You don't need to "create wealth" to be a productive and happy person. Just so you have enough to support yourself without being a burden on others -- that's enough. And please, please, do NOT go into any debt to send your kids to college. State schools all the way. The best way to "create wealth" is to avoid debt.

Very good advice here. Do NOT go into debt for college and do not let your kids take out loans.

If they are still in HS, stop the APs and do dual enrollment instead for college credit. Where I am, it's free. Then if you live near a community college, have your kids live at home and get their AA. If they are smart, they can do it in 3 semesters. If they are leaning towards a final BS in STEM, it's a good idea to check out requirements for the intro classes in the sciences.

There might be Biology 101A which is for general students, 101B which is for semi-science majors (like CS) and 101C which is for hard science and math majors. So they can take Bio 101A to get their AA, but when they start working on their CS degree, they will have to take Bio 101B. Better financially to just take Bio 101B right off the bat.

If you live near a state school, consider having them continue to live at home the last 2 years. Yeah, it's not the traditional experience, but that's a luxury now. It's not worth borrowing 20K a year just so they can live in a quad and walk to campus. Especially with the uncertainty about which majors will be worth the cost anymore, due to AI and having our economy purposely being tanked.

If you have saved money for college but haven't saved enough for retirement, stop college saving immediately. You will do your kids a much bigger favor by being able to fund your own retirement and not become a burden to them. Even if they have to work during college to pay their tuition, in the end, that is better for them.

While you are still under 65, start cutting extra spending and save as much as possible. If you have a 3% mortgage, don't pay it down.

Cut WAY back on travel, dining out, holiday gifts, graduation gifts for the next 10-15 years. Do not plan on funding expensive weddings. You just can't. Contribute 5K at most, and let them cover the rest themselves. You just can't afford to do otherwise.

I would never suggest someone in their mid 50s start their own business. There's a greater chance you will fail and lose what little savings you may have.

Try to look and act as youthful at work as possible to not be a reminder to management that you are "old" and dispensable. Try to line yourself up with roles and projects that can take you into your 60s. Keep your networking strong. Plan to work until 65 and beyond as a goal.

If you have at least 250,000K in savings, maybe even less, see a financial advisor to map out the next 10-15 years.

And please don't tell me you are one of those posters who has "only" saved 3 million and therefore have not built up any wealth. Please!

This is tricky advice. If I didn't take loans I would not have been able to go to Purdue for aerospace engineering. That degree from that school gave me a shot at the "American dream". I am wealthy today and I honestly I am glad I took student loans.

I'm the PP you're responding to. I agree with you sort of. Until a year ago, I would have said only get loans if you are going to major in Engineering, CS, Math, a for sure Pre-Med genius (no risk of washing out), Nursing, and a very few other majors.

But now with Trump tanking the economy and AI, is even Engineering/CS going to pay off? For some yes, but I'm sensing there's dark clouds on the horizon for this field. To the point of considering is there a way to minimize the loans by 2 years at Community College? Can you minimize living expenses by living at home and only taking on tuition debt? Can you work during the semester to minimize loans needed?

Majoring in Biology and Chemistry has not seemed to pay off in terms of considering student loans for over a decade, from all the friends of my kids who are ages 27-35. Today I had lunch at a local private college (they let the public dine for $6). They were showing the recent graduates who were offered jobs. One guy just graduated with a degree in Chemistry and took a job doing activities for an after-school Boys and Girls Club. I *know* that doesn't pay much.

I was a CS major and worked my career with aerospace and other engineers. We were paid well and it was my ticket out of poverty too. But with no $$, I did it by going to community college, living at home and going to the state school (which at the time was beating MIT in computer contests) and working 20-30 hrs/week, while triple majoring in CS, Math and Statistics. I don't know if 25hrs of work nowadays would cover tuition, but it just seems so risky borrowing $40K or more a year with the current STEM outlook. Never mind $40K a year for Communications major. And I know 40K is on the low side for many schools that are probably $60K or more?

Students from generational wealthy families that have connections will probably always find a job through family, friends of the parents and help sliding into an internship. But for those of us starting from zero, is it worth having student loans almost as big as a mortgage?

My son graduated 10 years ago in CS and is making great money. I know he's well over 200K, maybe 300K. But I'm hearing some worry in his voice about the future of the industry, and how difficult it will be to replace his job should he get laid off.

My daughter just finished 10 years to be a psychologist with with veterans with traumatic brain injuries. After her internship, she should make 100K to start. But she will have around $400K in student loans. Ouch!

And then all the kids who take student loans for a year or two and flag out, need to help family back home, or life just gets in the way. Now they have student loans and no degree to get a professional job. Really sad for them.

So I get you, and for academic go-getters like us in lucrative majors, they are probably safe getting loans if that's the only way to get through college. I sure hope this is still true.

Anonymous wrote:My husband, who was a war refugee as a child, lived poorly all through his 20s and early 30s because he invested in the stock market instead of moving out of a poor neighborhood, buying better food, or a car, or nice clothes, or buy stuff.

Now, thanks to him, we have more than 10M. At no point did he invest large sums, because he never had large sums: his salary at the time did not exceed 30K a year, if that. Now our HHI is 120-150K a year. We have two children, born in a one-bedroom apartment. When they were little, we would only buy food on sale. We bought our first basic compact car to drive DC1 home from the hospital. We still have that car 20 years later. We do splurge on certain things that are important to us, like education, but that's after decades of belt-tightening, living with extreme frugality and realizing we can simply sell stock to pay for private university.

I have posted multiple times over the years on DCUM, trying to explain to people that investing in the stock market or in real estate is possible at most income levels, even very low ones, but that it takes thought and very real sacrifice. Frankly, most Americans are not prepared to make those sacrifices. You cannot live a middle class lifestyle if you seriously want to invest and your salary is low. You cannot invest in real estate in expensive areas. You need to pick a neighborhood you hope will gentrify, and renovate it yourself, like my friend did. It's less work, if you're really poor, to buy stocks like my husband did. All these methods usually only bear fruit over multiple decades, which is why it's very important to start young.

The point is that you should not expect your salary to make you rich.

OP, you can still give it a try if you want. You have several decades left.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My husband, who was a war refugee as a child, lived poorly all through his 20s and early 30s because he invested in the stock market instead of moving out of a poor neighborhood, buying better food, or a car, or nice clothes, or buy stuff.

Now, thanks to him, we have more than 10M. At no point did he invest large sums, because he never had large sums: his salary at the time did not exceed 30K a year, if that. Now our HHI is 120-150K a year. We have two children, born in a one-bedroom apartment. When they were little, we would only buy food on sale. We bought our first basic compact car to drive DC1 home from the hospital. We still have that car 20 years later. We do splurge on certain things that are important to us, like education, but that's after decades of belt-tightening, living with extreme frugality and realizing we can simply sell stock to pay for private university.

I have posted multiple times over the years on DCUM, trying to explain to people that investing in the stock market or in real estate is possible at most income levels, even very low ones, but that it takes thought and very real sacrifice. Frankly, most Americans are not prepared to make those sacrifices. You cannot live a middle class lifestyle if you seriously want to invest and your salary is low. You cannot invest in real estate in expensive areas. You need to pick a neighborhood you hope will gentrify, and renovate it yourself, like my friend did. It's less work, if you're really poor, to buy stocks like my husband did. All these methods usually only bear fruit over multiple decades, which is why it's very important to start young.

The point is that you should not expect your salary to make you rich.

OP, you can still give it a try if you want. You have several decades left.

No American can handle that kind of hardship

LOL. Lots of us live this kind of life. We just aren't usually posting on DCUM Financial Forum.

OP probably also is living a fairly frugal lifestyle; just likely didn't manage to save much in investments. At age 50, it isn't too late. But it would help if both spouses were working and in jobs with pensions or a 401k plan with a match. Sure, best to start saving in your 20s, but even in your 50s, it isn't too late to save more for a secure retirement so you aren't a burden on your children.

Anonymous wrote:I came to this country in my 30s, went thru divorce, never built weath either. Secured a rent controlled (affordable housing) unit in an area with easy access to jobs, which will come in handy for my kid when he is older. My income after 65 will allow me to be on Medicaid which not only means free medicine but paid caregiving hours to help with my daily living. There are different ways to build wealth.

Anonymous wrote:

Anonymous wrote:My husband, who was a war refugee as a child, lived poorly all through his 20s and early 30s because he invested in the stock market instead of moving out of a poor neighborhood, buying better food, or a car, or nice clothes, or buy stuff.

Now, thanks to him, we have more than 10M. At no point did he invest large sums, because he never had large sums: his salary at the time did not exceed 30K a year, if that. Now our HHI is 120-150K a year. We have two children, born in a one-bedroom apartment. When they were little, we would only buy food on sale. We bought our first basic compact car to drive DC1 home from the hospital. We still have that car 20 years later. We do splurge on certain things that are important to us, like education, but that's after decades of belt-tightening, living with extreme frugality and realizing we can simply sell stock to pay for private university.

I have posted multiple times over the years on DCUM, trying to explain to people that investing in the stock market or in real estate is possible at most income levels, even very low ones, but that it takes thought and very real sacrifice. Frankly, most Americans are not prepared to make those sacrifices. You cannot live a middle class lifestyle if you seriously want to invest and your salary is low. You cannot invest in real estate in expensive areas. You need to pick a neighborhood you hope will gentrify, and renovate it yourself, like my friend did. It's less work, if you're really poor, to buy stocks like my husband did. All these methods usually only bear fruit over multiple decades, which is why it's very important to start young.

The point is that you should not expect your salary to make you rich.

OP, you can still give it a try if you want. You have several decades left.

No American can handle that kind of hardship

Anonymous wrote:My husband, who was a war refugee as a child, lived poorly all through his 20s and early 30s because he invested in the stock market instead of moving out of a poor neighborhood, buying better food, or a car, or nice clothes, or buy stuff.

Now, thanks to him, we have more than 10M. At no point did he invest large sums, because he never had large sums: his salary at the time did not exceed 30K a year, if that. Now our HHI is 120-150K a year. We have two children, born in a one-bedroom apartment. When they were little, we would only buy food on sale. We bought our first basic compact car to drive DC1 home from the hospital. We still have that car 20 years later. We do splurge on certain things that are important to us, like education, but that's after decades of belt-tightening, living with extreme frugality and realizing we can simply sell stock to pay for private university.

I have posted multiple times over the years on DCUM, trying to explain to people that investing in the stock market or in real estate is possible at most income levels, even very low ones, but that it takes thought and very real sacrifice. Frankly, most Americans are not prepared to make those sacrifices. You cannot live a middle class lifestyle if you seriously want to invest and your salary is low. You cannot invest in real estate in expensive areas. You need to pick a neighborhood you hope will gentrify, and renovate it yourself, like my friend did. It's less work, if you're really poor, to buy stocks like my husband did. All these methods usually only bear fruit over multiple decades, which is why it's very important to start young.

The point is that you should not expect your salary to make you rich.

OP, you can still give it a try if you want. You have several decades left.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Stop thinking about it. You don't need to "create wealth" to be a productive and happy person. Just so you have enough to support yourself without being a burden on others -- that's enough. And please, please, do NOT go into any debt to send your kids to college. State schools all the way. The best way to "create wealth" is to avoid debt.

Very good advice here. Do NOT go into debt for college and do not let your kids take out loans.

If they are still in HS, stop the APs and do dual enrollment instead for college credit. Where I am, it's free. Then if you live near a community college, have your kids live at home and get their AA. If they are smart, they can do it in 3 semesters. If they are leaning towards a final BS in STEM, it's a good idea to check out requirements for the intro classes in the sciences.

There might be Biology 101A which is for general students, 101B which is for semi-science majors (like CS) and 101C which is for hard science and math majors. So they can take Bio 101A to get their AA, but when they start working on their CS degree, they will have to take Bio 101B. Better financially to just take Bio 101B right off the bat.

If you live near a state school, consider having them continue to live at home the last 2 years. Yeah, it's not the traditional experience, but that's a luxury now. It's not worth borrowing 20K a year just so they can live in a quad and walk to campus. Especially with the uncertainty about which majors will be worth the cost anymore, due to AI and having our economy purposely being tanked.

If you have saved money for college but haven't saved enough for retirement, stop college saving immediately. You will do your kids a much bigger favor by being able to fund your own retirement and not become a burden to them. Even if they have to work during college to pay their tuition, in the end, that is better for them.

While you are still under 65, start cutting extra spending and save as much as possible. If you have a 3% mortgage, don't pay it down.

Cut WAY back on travel, dining out, holiday gifts, graduation gifts for the next 10-15 years. Do not plan on funding expensive weddings. You just can't. Contribute 5K at most, and let them cover the rest themselves. You just can't afford to do otherwise.

I would never suggest someone in their mid 50s start their own business. There's a greater chance you will fail and lose what little savings you may have.

Try to look and act as youthful at work as possible to not be a reminder to management that you are "old" and dispensable. Try to line yourself up with roles and projects that can take you into your 60s. Keep your networking strong. Plan to work until 65 and beyond as a goal.

If you have at least 250,000K in savings, maybe even less, see a financial advisor to map out the next 10-15 years.

And please don't tell me you are one of those posters who has "only" saved 3 million and therefore have not built up any wealth. Please!

This is tricky advice. If I didn't take loans I would not have been able to go to Purdue for aerospace engineering. That degree from that school gave me a shot at the "American dream". I am wealthy today and I honestly I am glad I took student loans.

I'm the PP you're responding to. I agree with you sort of. Until a year ago, I would have said only get loans if you are going to major in Engineering, CS, Math, a for sure Pre-Med genius (no risk of washing out), Nursing, and a very few other majors.

But now with Trump tanking the economy and AI, is even Engineering/CS going to pay off? For some yes, but I'm sensing there's dark clouds on the horizon for this field. To the point of considering is there a way to minimize the loans by 2 years at Community College? Can you minimize living expenses by living at home and only taking on tuition debt? Can you work during the semester to minimize loans needed?

Majoring in Biology and Chemistry has not seemed to pay off in terms of considering student loans for over a decade, from all the friends of my kids who are ages 27-35. Today I had lunch at a local private college (they let the public dine for $6). They were showing the recent graduates who were offered jobs. One guy just graduated with a degree in Chemistry and took a job doing activities for an after-school Boys and Girls Club. I *know* that doesn't pay much.

I was a CS major and worked my career with aerospace and other engineers. We were paid well and it was my ticket out of poverty too. But with no $$, I did it by going to community college, living at home and going to the state school (which at the time was beating MIT in computer contests) and working 20-30 hrs/week, while triple majoring in CS, Math and Statistics. I don't know if 25hrs of work nowadays would cover tuition, but it just seems so risky borrowing $40K or more a year with the current STEM outlook. Never mind $40K a year for Communications major. And I know 40K is on the low side for many schools that are probably $60K or more?

Students from generational wealthy families that have connections will probably always find a job through family, friends of the parents and help sliding into an internship. But for those of us starting from zero, is it worth having student loans almost as big as a mortgage?

My son graduated 10 years ago in CS and is making great money. I know he's well over 200K, maybe 300K. But I'm hearing some worry in his voice about the future of the industry, and how difficult it will be to replace his job should he get laid off.

My daughter just finished 10 years to be a psychologist with with veterans with traumatic brain injuries. After her internship, she should make 100K to start. But she will have around $400K in student loans. Ouch!

And then all the kids who take student loans for a year or two and flag out, need to help family back home, or life just gets in the way. Now they have student loans and no degree to get a professional job. Really sad for them.

So I get you, and for academic go-getters like us in lucrative majors, they are probably safe getting loans if that's the only way to get through college. I sure hope this is still true.

Anonymous wrote:I've been a public service on my life, spouse has been in general low-paying jobs. We have never been able to save much and now kids will be going to college. I feel like we missed the boat on financial advice and what we should do to build wealth. Is there anything that can be done at this point?

Anonymous wrote:I can tell you year by year how much I made, how much I spent, why I wasn't able to build wealth at that time, and what some of the opportunities were that passed me by.
For example, condos were $70k in Adams Morgan in 1998. In 2001 we moved to Rosslyn. Imagine being able to buy a condo there instead of rent. My sister and I would have paid it off in 7 years.
I was an international student from 1996-2007 without a permit to buy a home in US or invest. Bank of America even took my credit card back because of my visa.
I made minimum wage, which is not good for wealth building (total of $350k in 28 years according to my SS)and paid for international rates for my school. It took me 17 years to finish. I have BA in finance after changing major many times. What a waste of time and money.
2003-2006 I bought a condo in the old country for ca $50k (mortgaged at 16%). The same money in QQQ or other funds, would be a million $ today.
In 2007 I bought a land abroad for $100k and got a mortgage. Sold it in 2023 for $150k.The down-payment and mortgage/insurance payments put into an ETF at the time I sent my mortgage payments, would be over a million today.
I was already using Amazon to shop in 2007. The same payments into amazon stock and maybe MSFT/apple, would be way more than a million.
In 2008 I bought a condo in DC. Paid it for 11 years. The same mortgage/HOA payments in qqq/later voo would be about a million today. 15 year mortgage made the place very expensive. All the extra payments were where I lost money the most.
2014 my partner bought a condo. Same thing. We could have rented and anything extra we paid, would have been a lot more than it was when they sold it.
$20 a day into market since I moved here in 1996, would be over a million now. I had the money. I wasn't a spender and worked 10-12 hour shifts. I just didn't know anything about stock market, nor was there a free app like we have now. We didn't even have banks back at home when I left.
In 2020 I invested the equity of the condo I sold in 2019 into markets. The stocks I bought did 10X.
I went on to sell the land in early 2023 and put that money into markets also.
Five years in the markets, I learned to make much higher return that the 10%.
Years and years in real estate, taught me nothing, but to stay away.
My last two years return in two accounts (can't touch the taxed ones too much) was 100% year over year. I did the second 100% in 6 months. All this includes many mistakes.
As for my kids, one is starting their Roth at 18 this year. I will try to get him the same higher return as for myself since contributions to Roth are limited. The younger kid got inheritance coming and is set at 18 when we can start to invest that money. It sits at 4% now for years to come. Sad to say. My time is more valuable than going to court and paying the bond, the lawyers, and still having to keep the money safe in 4-10%.
I'm not a spender. My money is growing faster than I can use it. Once I got enough money that banks/landlords noticed, there was this upward spiral that happened.
My car loan is 0%. Seems hard to many people. I drive only 3k miles a year, because I don't really work for money anymore. I make enough to max the Roth.
Most people will buy 1-2 more cars while I'm fine with this one. Those next 2 cars they buy is the million they won't have.
My credit card cash back is 4%. I took $50k out and doubled it.
My landlord wanted to raise my rent. I moved to another condo and got to keep the same rent. Current landlord dumped the real estate company they hired to deal with tenants as I'm capable of taking care of the place myself.
I will save them money and hopefully myself rent increase. I used to own in the building. I know the maintenance men and the problems that may arise.
My older kid got 30 credits transferred for college from DCPS. I did nothing for that, but I do appreciate it. Now he can work more and we can really start the Roth for him.
I will get rid of my health insurance, because I can insure myself and go to EU is I must. I'm never sick and without much work, I can take even better care of myself and the kids.
I also don't have tax expense as I really don't work for living anymore. I get back more than I pay as HH.
When I tell friends about getting in the markets because they would learn a lot, or that I think I know how doubling is done, they have no idea what I'm talking about. They have zero interest in it. One friend even said that she goes blank when she hears numbers.
When I tell them about upward spiral, they look at me like I'm crazy.
I'm sure there were even better opportunities I missed, but after years of messing with real estate, I got into markets and it wasn't too late.
Doubling my money is way better than getting into market early. Early is for learning, while doubling is to catch up.
We did waste lots of money over the years on buying crap just like many people. Being more mindful of that, would have also given us a good start. I'm not even old enough to be able to make the catch up contribution to Roth.
My latest books are about saving on taxes. I already get more back than I pay. Should still be a good read though.
My kids will not sign up for 401k. The match is useless to us. That's lost money right there going into year two.
One other thing happened. I can command much higher pay at work now. More like $50 an hour plus all the food and drinks I can consume. Used to be no food, no drinks, long walk to work (18 blocks), not even paid the $2.77 an hour required by law as wage theft was normal. I can absolutely see and appreciate the difference. I'm just sad I was ever made to work without breaks and for below minimum at times. This was also a big reason why I wanted to be free of work. I just didn't know how I was going to achieve it. I didn't know money and personal finance can do it without a high salary. I counted my money several times day as a kid.
Perhaps if paid off finally.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Stop thinking about it. You don't need to "create wealth" to be a productive and happy person. Just so you have enough to support yourself without being a burden on others -- that's enough. And please, please, do NOT go into any debt to send your kids to college. State schools all the way. The best way to "create wealth" is to avoid debt.

Very good advice here. Do NOT go into debt for college and do not let your kids take out loans.

If they are still in HS, stop the APs and do dual enrollment instead for college credit. Where I am, it's free. Then if you live near a community college, have your kids live at home and get their AA. If they are smart, they can do it in 3 semesters. If they are leaning towards a final BS in STEM, it's a good idea to check out requirements for the intro classes in the sciences.

There might be Biology 101A which is for general students, 101B which is for semi-science majors (like CS) and 101C which is for hard science and math majors. So they can take Bio 101A to get their AA, but when they start working on their CS degree, they will have to take Bio 101B. Better financially to just take Bio 101B right off the bat.

If you live near a state school, consider having them continue to live at home the last 2 years. Yeah, it's not the traditional experience, but that's a luxury now. It's not worth borrowing 20K a year just so they can live in a quad and walk to campus. Especially with the uncertainty about which majors will be worth the cost anymore, due to AI and having our economy purposely being tanked.

If you have saved money for college but haven't saved enough for retirement, stop college saving immediately. You will do your kids a much bigger favor by being able to fund your own retirement and not become a burden to them. Even if they have to work during college to pay their tuition, in the end, that is better for them.

While you are still under 65, start cutting extra spending and save as much as possible. If you have a 3% mortgage, don't pay it down.

Cut WAY back on travel, dining out, holiday gifts, graduation gifts for the next 10-15 years. Do not plan on funding expensive weddings. You just can't. Contribute 5K at most, and let them cover the rest themselves. You just can't afford to do otherwise.

I would never suggest someone in their mid 50s start their own business. There's a greater chance you will fail and lose what little savings you may have.

Try to look and act as youthful at work as possible to not be a reminder to management that you are "old" and dispensable. Try to line yourself up with roles and projects that can take you into your 60s. Keep your networking strong. Plan to work until 65 and beyond as a goal.

If you have at least 250,000K in savings, maybe even less, see a financial advisor to map out the next 10-15 years.

And please don't tell me you are one of those posters who has "only" saved 3 million and therefore have not built up any wealth. Please!

This is tricky advice. If I didn't take loans I would not have been able to go to Purdue for aerospace engineering. That degree from that school gave me a shot at the "American dream". I am wealthy today and I honestly I am glad I took student loans.