Tuesday, August 2, 2011

Day 292 - A Letter To My 18-Year-Old Self

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Dear 18-year-old Sarah,

Thia is a letter from your future self attempting to knock some financial sense into you as you prepare to head off to college. I know you think you are pretty hot stuff right now, but trust me there are some a lot of things you need to learn when it comes to debt and personal finance. I wish I could send my 12 Steps to Debt Freedom back in time, but you probably wouldn't read it anyway.

Reconsider going to school in-state. I know you are stubborn and have set your mind to leaving Oklahoma as soon after graduation as possible to go to that highly ranked private school in California. But guess what? I'm still paying off that big undergrad loan you signed for. At least apply at the state schools and see what financial aid they offer you. With your grades and resume, I have a feeling you will get a full ride or something very close to it. Trust me - student loans suck. Debt sucks.

Don't apply for that credit card your freshman year. I know it's important to you not to miss out on any fun college events, but "making money" by paying for people's food/tasty beverages in exchange for cash is not smart. I know you are working hard every summer and also during the school year to make money, but your spending habits are a little out of control. Yes, one of your best friends at school is loaded. Yes, it's fun to buy stuff and believe that you will get that high paying job after college and just pay everything off. And you will make good money eventually (after that first year you took off to be a ski bum and travel to Alaska - which I, by the way, totally approve). But all I ask is that you try to cut back so that you don't struggle as much with all the credit card payments looming in your future.

Don't lease a brand new car right after graduate school. Just because you can afford the monthly payments doesn't mean you need to lease a brand new car. You don't have a garage and you will get hail damage while parked at the airport on a business trip just a few months after buying it. You will also work a long-term assignment in New York City for over two years (awesome, by the way!!), and you will be paying on a car you don't drive because it's a lease and you can't return it. Although your Subaru turns out to be a great car, consider buying and looking at used. Or just keep that Saturn coupe for a few years longer until your debt is under control.

Tricking yourself into thinking you deserve something doesn't mean you should buy it. I can't fault you for this because I'm pretty sure this attitude runs in the family. Just think twice before you shell out cash for something just because you think it will make you feel better for a period of time. The stress of the credit card bill will wipe out that buyer's high faster than you know it.

Rather than following a career path because you should, spend more time thinking about your passions and less time drinking and partying. Allowing other people to tell you the best direction for your future is a lot easier than figuring it out for yourself. Unfortunately, you will end up in a job you don't like with your priorities completely mixed up. Don't doubt your gut instincts - your family has instilled in you many positive values. Follow your heart.

Make as much time for family as you can. Someone very special to you will be taken away way too soon and it's going to be a life changing event. Know that every moment will be a precious memory eventually. Call your parents and siblings often. Tell them you love them. Then tell them again. People need to be told they are loved - you won't regret it.

Stay tuned,

(From Your Financially Responsible Future)


Knowing what you know now, what advice would you give to your 18-year-old self?


17 comments:

Andrea @ SoOverDebt said... Best Blogger Tips

I wrote a similar post a few months ago - it's a little creepy how similar we were at 18. I think we would have been friends! (Except I would have been totally jealous that I didn't think of the "making money" with the credit card thing). I wish someone would have talked to me back then, but I don't think I was ready to listen.

Kellen said... Best Blogger Tips

Except that Sarah-today learned SO MUCH from 18-year-old Sarah's mistakes. And maybe going to that private school helped Sarah-today get the good job she has now, even after taking a year off to bum around Alaska :). (Man, I wish I did that after college, but I was all sensible, went to a state school, and had to start working immediately to pay bills, etc.)

Robert said... Best Blogger Tips

So many people have the same lessons for themselves - too bad they also never would have listened to the advice at 18 anyway...

Jeff @ Sustainable Life Blog said... Best Blogger Tips

I think that Robert is right. All of this stuff would have been great to hear at 18, but probably would have been ignored.  I'd tell myself that it'd be OK to skip outings with friends and others to save some cash.  I'd also start doing things that I enjoyed that were free.

Lindy Mint said... Best Blogger Tips

If only we didn't have to make so many important life decisions when we are 18.  It's hard to avoid though.  And I agree, I don't think many of us would have listened to this advice.

My parents forbid me from going to school out of state.  I thought they were being irrational, but now I'm thankful I didn't fight it.  But I definitely made some mistakes of my own regardless.

Jackie said... Best Blogger Tips

Love this.  I wonder what advice we'd have for ourselves if we could look 20 years into the future NOW and get that same kind of perspective.

Kellen said... Best Blogger Tips

 Oh my goodness, I hope I'm not kicking myself about NOT buying a house now while they're so cheap.

Travis Pizel said... Best Blogger Tips

Many of these really strike a chord with me.  I also applied for my first credit card my freshman year. It just went downhill from there.   Convincing myself that I deserve things and then charging them?  Check.  Needing to realize the importance of family?  My wife taught me that one, thankfully.

Miss T said... Best Blogger Tips

Loved this post. Great advice. I can relate to all of it. My own letter would look something similar. I think another thing to add is don't fall into peer pressure. Don't feel like you should have the same things as your friends. They may be in a different financial situation than you. Basically, avoid keeping up with the Jonses.

60kproject said... Best Blogger Tips

Kellen, thanks so much for your comment. You are right - maybe I wouldn't know what I do today if I hadn't made those mistakes. I just wish there was a cheaper way.....

60kproject said... Best Blogger Tips

Hmm, I would love to figure out a way to actually engage 18 year olds in a dialogue about personal finance. Wondering if it's actually a realistic goal?

60kproject said... Best Blogger Tips

It's amazing how smart parents actually are - too bad most people don't realize it until after the fact.!

60kproject said... Best Blogger Tips

Hmmm, great idea for another blog post. I'll definitely have to think about this one.

60kproject said... Best Blogger Tips

Travis, you seem to be on the right track now! Maybe this is just a phase we all go through. So instead of trying to prevent it from happening, a better goal is to minimize the damage that occurs.

60kproject said... Best Blogger Tips

A great piece of advice, Miss T! Trying to keep up with everybody definitely makes for some poor spending habits. Believe me, I've done it! One really good lesson I learned is that the friend who is driving a Beemer and carrying around a $3,000 purse probably didn't tell you that their total gross earnings for the year were only $20,000 (this is a true story). So trying to keep up with broke people pretending to be rich will most likely lead you down that same path.

Jacob @ My Personal Finance Journey said... Best Blogger Tips

Great tips to your younger self 60k!

I especially agree with the advice on going to school in state and avoiding racking up excessive debt right after college in order to allow yourself to get ahead in life!

Anonymous said... Best Blogger Tips

Just moved due to a new state and to get in-state tuition I need a year of residency I am eighteen and the folks I'm living with want me to wait a year but I already took a gap year to do some volunteering and internship... I really want to start college, waiting another year seems like a waste but what they say loans can be harmful. I know it's scary to be in debt and I know they care for me but is their advice really what's best or should I follow my gut..
Lacking gumption..need direction...

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