A couple weeks back I went out to dinner with my brother at the Peking Duck House in Manhattan. After an extremely tasty meal the bill came with a fortune cookie.
The cookie read: “Perhaps you’ve been focusing too much on saving.”
My girlfriend (err “friend” .. whatever it’s complicated now) got a kick out of it when she saw it in my room. So is the fortune cookie right? I’m 20 years old. Have I been focusing too much on saving? I have roughly…
- $1,500 in an emergency fund that grows $30/week
- $10,000 in my portfolio mostly invest in small to mid-cap stocks
- $3,000 in my roth IRA split between an index fund, dividend appreciate fund, and reit fund.
So for someone that makes $10.25/hour and works 3-4 days/week plus school… am I saving too much? Honestly I don’t think so. Here’s why: I still enjoy my life.
I don’t mind work. I’m content with social life, although it is somewhat more limited nowadays as I’m busier. But being busy for me allows me to stay more focused.
I’m a calculating person. The great unknown of life and where it takes you intrigues me but scares me at the same time. That’s why I need an emergency fund. I may die tomorrow, a week from now, or 60 years later… but I won’t die broke.
Historically the stock market has always been one of the best asset classes for investment over the long term. So why not start early? I’ve always been a big advocate of having your money work for you. My thinking is that if I plant the seeds to my money tree now, life won’t be as hard later on. My expenses now are extremely limited compared to what lies ahead (marriage, kids, etc.). I want a comfortable future, where my kids can learn the value of a dollar but it won’t be because for lack of it.
One of the key reasons for me to attain a level of savings has been to do what many people my age (or some people throughout their entire life) haven’t been able to do. That’s to get past the designer jeans, the fancy cars, the latest gadgets, etc. Those things don’t say anything about you besides how much you’ve spent, not how much you’re worth. My thinking is it’s always better to have money, than look like you have money.
So Mr. Fortune Cookie, you’re wrong…
