Am I in over my head?

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Forward
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Am I in over my head?

Post by Forward » Sun Sep 14, 2014 3:33 pm

I am 19 and received $250,000, currently have a paid off car and no job but I basically live for free. Everyone keeps telling me I should just speak with Financial Advisors and find one who has been doing it for a long time. I feel like I could just make a Vanguard account and do something like 40% total stock, 20% international stock, and 40% bonds. What would the benefits be of me finding a FA that would justify paying somewhere around 1% per year? I understand that if I find a good FIA they would be able to help me with stuff like taxes but it seems like it wouldn't be too hard to fill out a form and send it in.

livesoft
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Re: Am I in over my head?

Post by livesoft » Sun Sep 14, 2014 4:20 pm

I think you are thinking well. No need for a financial advisor right now in your situation.
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TomatoTomahto
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Re: Am I in over my head?

Post by TomatoTomahto » Sun Sep 14, 2014 4:22 pm

Welcome to the forum, Forward. I agree with your thoughts about getting an FA; you can good advice here for less than $2,500 per year. Eta: as in free. And with no conflicts of interest.

I'm usually one to encourage more bonds rather than fewer, but if that asset allocation makes you comfortable, go for it, but understand that it is conservative for someone your age.
Okay, I get it; I won't be political or controversial. The Earth is flat.

MoneyIsntEverything
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Re: Am I in over my head?

Post by MoneyIsntEverything » Sun Sep 14, 2014 4:30 pm

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lululu
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Re: Am I in over my head?

Post by lululu » Sun Sep 14, 2014 4:31 pm

Are you living with your parents? If so, and unless you're in school, you should be paying them rent.

Swampy
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Re: Am I in over my head?

Post by Swampy » Sun Sep 14, 2014 4:32 pm

You can pay someone to give you advice for a fee
or
you can take in all the advice given here for free.

Just because it's free, doesn't mean it's not good.

A lot of advice here is invaluable.

My advice, don't rush into anything. Open a savings account at CITbank (0.9%) while you mull your options.
If you fail to plan, you plan to fail. | Failure is not an option. | If I have seen further, it is because I was carried on the shoulders of giants.

Jack FFR1846
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Re: Am I in over my head?

Post by Jack FFR1846 » Sun Sep 14, 2014 4:38 pm

Your choices and % in Vanguard funds sounds great to me.

A financial advisor will simply be a drag on your returns.
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dbr
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Re: Am I in over my head?

Post by dbr » Sun Sep 14, 2014 4:38 pm

Swampy wrote: Just because it's free, doesn't mean it's not good.

And just because you pay for it does not mean it is good.

One of the ironies around investing is the upside down character of this exchange. As it is said, you get what you don't pay for.

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Kosmo
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Re: Am I in over my head?

Post by Kosmo » Sun Sep 14, 2014 4:38 pm

I think you have the gist of it, but the devil is in the details. Where did the money come from? Do you owe taxes? Is this an inheritance and there are tax advantaged accounts involved? There are lots of knowledgeable folks here who could point you in the right direction for any of these situations.

MoneyIsntEverything
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Re: Am I in over my head?

Post by MoneyIsntEverything » Sun Sep 14, 2014 4:40 pm

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Saving$
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Re: Am I in over my head?

Post by Saving$ » Sun Sep 14, 2014 4:51 pm

No, I don't think you are over your head.

If you are the type that can seek, ask, listen and learn, you do not need to pay an adviser 1% year to, if they are good, tell you the same thing you get here for free, or if they are bad, lead you astray. The fact that you posted here indicates you are the type who can seek, ask, listen and learn. This speaks highly of you; many 19 year olds do not have that maturity.

An adviser is just one person, giving you their advice. They may have a bias toward more stock, or more bonds, or whatever.
Here, you will get the equivalent of MANY advisers, all with a different bias. They will even discuss and debate their advice to you among themselves, in an effort to hone on on the best advice to you, and you get to listen in on this discussion. You read all the advice, and go with what suits your needs.

If you are ready to proceed with the allocation you have proposed, go for it. It is totally reasonable.
If you want to dollar cost average into the market, if you are debating about whether your stock to bond allocation is correct, hold that portion you are not yet ready to invest in a high yield savings account.

50 years ago, with $250k, you would have been set for life. Even today, $250k is an incredible start. But it is a start.
More important than grappling with a Stock/Bond allocation of 60/40 vs 70/30, is YOUR LIFE PLAN. What are you going to do?
- Get a job?
- Go to college?
- Go to trade school?
I am not asking what your dreams are, I am asking what your plan is. They are different. If you don't have a plan, you must put your focus there.
If you have a plan, what are you doing to put your plan into action?

Post back with the above info, and we can help you with honing your financial plan for the $250k.

Swampy
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Re: Am I in over my head?

Post by Swampy » Sun Sep 14, 2014 5:12 pm

dbr write
And just because you pay for it does not mean it is good.
Sigh, how true.

I paid dearly for some of the worst advice and planning.
Over a decade later, I'm still paying for it.

That said, forward, educate yourself. You are in an enviable position.

The absolute worst thing you can do is look for 'excitement' with your investment. Dull and boring is so much better.

I'm in the minority here when I say dollar cost average over a year or two instead of lump summing it.
I, for one, don't like investing all at once. What if the market drops 10-20-30% or like it did in 2008-09?
If you get blindsided after lump summing it, you might panic. It's easier (at least for me) to ease into things.

If you lump sum it, you can easily be worth $2 Million by age 50.
If you DCA over 2 years, you will sill be worth around $1.9 million.
I consider that the price of insurance while you're building your positions.
If you fail to plan, you plan to fail. | Failure is not an option. | If I have seen further, it is because I was carried on the shoulders of giants.

chrysogonus
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Re: Am I in over my head?

Post by chrysogonus » Sun Sep 14, 2014 5:18 pm

That bond allocation seems high, but if you haven't experienced a market downturn then it's reasonable, as 40% bonds will help smooth out the dips. Given that, your suggested allocation is probably better than most financial advisors would put you in. If you don't have any tax-advantages space (or enough, which seems likely), you may want to consider muni bonds rather than TBM.

As for paying for tax advice - if it's just a W2 and some 1099s then there's no reason to pay someone. Turbotax is pretty easy to use. If it gets more complicated (K1s, AMT, Incentive Stock Options, etc) then I'm of the opinion that it's money well-spent.

Otherwise, the advice about figuring out your long-term plan is a good one. Since you're 19, investing in your human capital (i.e. education) probably makes the most sense, but how to do that depends on your goals.

mhalley
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Re: Am I in over my head?

Post by mhalley » Sun Sep 14, 2014 5:44 pm

This money can give you a great start in life. The first thing to do is to set goals. Do you want to go to college? If so, Did your parents plan to pay for it, and do they still plan to now that you have this $? There are many things this money can be used for. College, business, buy a house, the list goes on and on. It would be easy to squander it, so I think the most important thing for now is to keep it safe while you decide what to do with your life. Take the majority of the money and put it in a laddered cd over the next 3-5 years, educate about investing by reading everything on the wiki and several of the recommended books. Once you have a plan, then proceed with investing.
Mike

abyan
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Re: Am I in over my head?

Post by abyan » Sun Sep 14, 2014 5:48 pm

Absolutely no reason to pay for financial advice. As someone else said, you can get it here for free.

I'd be curious what your thinking is behind a 40% bond allocation at age 19. I'd argue that you don't need any bonds at all at your age. The only reason I can imagine is that you might freak out if your investments plummet 40% or 50% during the next downturn, so if you invest in bonds your balance won't go down as much. I've never found that to be a compelling reason (I.e., you shouldn't invest in 40% bonds, but you might freak out if you don't, so invest in 40% bonds anyway).

Now, there is an argument to be made that perhaps you keep some of the money in "safer" investments so that you can put a down payment on a home some day, etc. But still, 40% bonds at age 19, with a $250k windfall, is IMHO a waste of an amazing opportunity. But you have to do what makes you comfortable. But please don't go to financial adviser :-)

Forward
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Re: Am I in over my head?

Post by Forward » Sun Sep 14, 2014 6:10 pm

Wow I didn't expect so many replies and I'm not too familiar with this type of forum format but here are some answers to the questions.

-
Kosmo wrote:I think you have the gist of it, but the devil is in the details. Where did the money come from? Do you owe taxes? Is this an inheritance and there are tax advantaged accounts involved? There are lots of knowledgeable folks here who could point you in the right direction for any of these situations.
This was a one time payment and will most likely be the most money I will ever have received at once. The money is in my account and after taxes. I am not sure what you mean by tax advantaged accounts but it is just in a savings/checking account as of now.

-
Also important: What are your plans for this money? Retirement savings, school, start a business, home down payment, anticipated increase in near-future expenses? A good strategy for the long term might not be appropriate for short-term needs.
I'd like to essentially set and forget this money to let it grow for when I will need it. I am looking for a job right now but it will most likely be something around $9 per hour. Also no major plans that would require a large sum of money any time soon.

-
I am not asking what your dreams are, I am asking what your plan is. They are different. If you don't have a plan, you must put your focus there.
If you have a plan, what are you doing to put your plan into action?
The most important thing to me right now is finding a job. Honestly I don't want to go to college if I don't have to because I don't like learning in a classroom environment. I am much more comfortable on a computer by myself to learn. That being said I do have 14k set aside for college in a state plan and will most likely end up going. Once my girlfriend is finished with college we will most likely move in together wherever she can get a job. Not sure if its a great plan but its what I have right now.

-
That bond allocation seems high, but if you haven't experienced a market downturn then it's reasonable, as 40% bonds will help smooth out the dips. Given that, your suggested allocation is probably better than most financial advisors would put you in.
Initially I wanted to wait to invest because of the condition the market seemed to be in but as I got deeper into learning about investing the same few things popped up everywhere I looked. Don't try to time the market, find low fee funds, and stay in it for the long run. I want 40% bonds because of how it seems the market has been growing since the last downturn in 08 there could be another one coming. Since I plan on lump summing such a large amount the 40% bonds are there to sell off and reinvest into stocks if there is a downturn. Kind of like dollar cost averaging I suppose. This may not be a viable strategy but I'm still learning.

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Re: Am I in over my head?

Post by z3r0c00l » Sun Sep 14, 2014 6:16 pm

Forward wrote:I am 19 and received $250,000, currently have a paid off car and no job but I basically live for free. Everyone keeps telling me I should just speak with Financial Advisors and find one who has been doing it for a long time. I feel like I could just make a Vanguard account and do something like 40% total stock, 20% international stock, and 40% bonds. What would the benefits be of me finding a FA that would justify paying somewhere around 1% per year? I understand that if I find a good FIA they would be able to help me with stuff like taxes but it seems like it wouldn't be too hard to fill out a form and send it in.
Those people are totally wrong, get used to most people you meet knowing nothing about investing properly. Ask them (at some point) what a stock split is. See how many think that you earn money from a split.

MoneyIsntEverything
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Re: Am I in over my head?

Post by MoneyIsntEverything » Sun Sep 14, 2014 6:35 pm

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Forward
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Re: Am I in over my head?

Post by Forward » Sun Sep 14, 2014 6:55 pm

MoneyIsntEverything wrote:I think you can aim higher than $9/hr for employment prospects. Not going to college can be an ok path. What kind of work are you interested in? If you like working with your hands, consider that skilled trades (electrician, plumber, carpenter, machinist, ...) can pay pretty well. What about an apprenticeship, where pay might be initially low but you'd be building a skill set? A similar argument could be made for an office job like computer programming or web development.

As others have mentioned, $250K is a large amount for someone your age, but your greatest asset is still your human capital.
The problem for me is that I really have no idea what I want from life right now. I'm aiming for $9/hr because I don't see myself getting hired anywhere except for major chains like Wal-Mart, Publix, Circle-k, Papa Johns, etc. since I have no prior job experience and only a high school diploma. What sort of jobs would an apprenticeship be associated with?

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BL
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Re: Am I in over my head?

Post by BL » Sun Sep 14, 2014 7:03 pm

I think you have a very mature way of thinking regarding investing. Starting out fairly conservative is a smart idea. It wouldn't hurt to put some fraction in that portfolio and sit on the rest in CDs or I-Bonds for a while while you get educated on investing and also decide what to do with your life. If you have $100,000 in Vanguard, you can have it managed for 0.3% if you choose; that certainly seems better than the typical 1%. But if you can stick with your plan you may not need it.

Planning your immediate future may be the most important thing you do for now. Perhaps get a 2-year degree in your area of interest at a community college or technical college sometime soon. Volunteering your time doing computer work may help you decide what you want to do and also lets you network with people of similar interest. There is a book, What color is your parachute, which may give you some ideas. I don't think aspiring to a minimum wage job is enough of a goal for you. Use some of that smart thinking to come up with something you like. It is entirely possible that this will be the best investment for your money. Just be careful that someone doesn't take advantage of your money, whether it is a private education institution, insurance or investing salesman, or free-loading friends.

toto238
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Re: Am I in over my head?

Post by toto238 » Sun Sep 14, 2014 7:13 pm

If you like working on computers, consider taking some computer programming courses online or at a community college. In today's economy, if you can write code well, there's a job for you out there. And it will pay better than $9/hr.

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seeshells
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Re: Am I in over my head?

Post by seeshells » Sun Sep 14, 2014 7:28 pm

Your not over your head. I too would suggest perhaps, personal educational enrichment. It will return a higher annual income allowing you options.

MoneyIsntEverything
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Re: Am I in over my head?

Post by MoneyIsntEverything » Sun Sep 14, 2014 7:35 pm

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yosef
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Re: Am I in over my head?

Post by yosef » Sun Sep 14, 2014 7:36 pm

You need some kind of post-HS education, period. It doesn't have to be a 4 year college, a community college program preparing you for a career that's in demand would be fine. Though I will point out a 4 year college would give you time to decide what you like and your money would almost surely allow you to graduate debt free with money left over. If you go out into the workforce full time now and start taking on expenses you will find it very hard to go back to school. As a previous poster said, your most valuable asset by far is your human capital, and education invests in that.

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Watty
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Re: Am I in over my head?

Post by Watty » Sun Sep 14, 2014 8:08 pm

Forward wrote: Everyone keeps telling me I should just speak with Financial Advisors and find one who has been doing it for a long time. I feel like I could just make a Vanguard account and do something like 40% total stock, 20% international stock, and 40% bonds. What would the benefits be of me finding a FA that would justify paying somewhere around 1% per year? I understand that if I find a good FIA they would be able to help me with stuff like taxes but it seems like it wouldn't be too hard to fill out a form and send it in.
It is important to understand that "financial advisors" are very loosely regulated and they the vast majority of them work on commission and will get paid a huge commission to put you into terrible investments so there is a big conflict of interest for them. The 1% fee is typically just the tip of the iceberg and the investments they select for you may have ongoing expenses that might even be hidden so it would be hard to even know how much you are paying them. The annuities and life insurance they sell are particularly bad choices for someone with your general situation so run if anyone tries to sell you one of these. The financial advisors you see in the local strip mall should be trusted about as much as you would trust a used care salesman.

Getting professional tax advice is a different issue since there could be tax issues related to the money, but a tax advisor would usually charge by the hour and not receive a commission.

There is a wiki on how to manage a windfall.

http://www.bogleheads.org/wiki/Managing_a_windfall

One of the key things it to not be afraid to just put the vast majority of the money into something ultra safe like insured CD's for at least six months, a year would be better, while you adjust to having the money and learn more.

The book "The Bogleheads Guide to Investing" would be a good starting point and it is very readable.

http://www.amazon.com/s/?search-alias=a ... Bogleheads

MoneyIsntEverything wrote:
Forward wrote: What sort of jobs would an apprenticeship be associated with?
Most skilled trades (electrician, plumber, carpenter, machinist, as I mentioned, along with printer, neon sign maker, car or diesel engine mechanic, welder, and other similar jobs) are structured as an apprenticeship system, which could be formal or informal training for new hires, depending on employer. You might be making minimum wage initially but move up as you prove your skills, sometimes through a state licensing system. I don't have direct experience, but my field, experimental science, is also something of an apprenticeship built into an academic environment.
+1

You would need to do your own research but some trades have a high percentage of people in them that are getting near retirement age.

You need to be very careful of the "for profit" schools that you will see advertised on TV. They often are poorly regarded in their industry and have very low graduation rates.

IPer
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Re: Am I in over my head?

Post by IPer » Sun Sep 14, 2014 8:21 pm

You are in a unique position at this time. Most likely if you stuck that money in a Target Date or Life Style fund (Vanguard) you
could go do anything with your life and as long as you never took anything from that money for 46 years then you could most likely
retire on it and be ahead of around 95% of the crowd!. Along the way if you have contributed to an IRA (because you were working
and learned how to be disciplined about your money) you can only increase those possibilities.
Read the Wiki Wiki !

IPer
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Re: Am I in over my head?

Post by IPer » Sun Sep 14, 2014 8:29 pm

Here is an opinion from firecalc if you put that money in a balanced fund like Vanguard Target 2060 or Life Cycle and didn't touch it for 46 years, contributed NOTHING along the way but drew nothing either and assuming you need $3000/mo cash to survive:

"FIRECalc Results Based on Historical Performance of Selected Assets

Your spending in every year after the first year will be adjusted for inflation, so the spending power is preserved.

Because you indicated a future retirement date (2060), the withdrawals won't start until that year. The tested period is 46 years of preretirement plus -16 years of retirement, or 30 years.

FIRECalc looked at the 49 possible 30 year periods in the available data, starting with a portfolio of $250,000 and spending your specified amounts each year thereafter.

Here is how your portfolio would have fared in each of the 49 cycles. The lowest and highest portfolio balance throughout your retirement was $250,000 to $5,565,395, with an average of $2,403,382. (Note: values are in terms of the dollars as of the beginning of the retirement period for each cycle.)

For our purposes, failure means the portfolio was depleted before the end of the 30 years. FIRECalc found that 0 cycles failed, for a success rate of 100.0%."

I would say, in my opinion, you are in an enviable position, don't blow it!
Read the Wiki Wiki !

IPer
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Re: Am I in over my head?

Post by IPer » Sun Sep 14, 2014 8:32 pm

pss - Looks like you just joined a few days ago which means you probably have no idea what folk are talking about or your head is swimming, make sure you
read the Wiki a few times and understand most of it: http://www.bogleheads.org/wiki/Main_Page
Read the Wiki Wiki !

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Re: Am I in over my head?

Post by Katie » Sun Sep 14, 2014 9:00 pm

I just want to say how impressed I am with your attitude about this money, and the work you've done researching ideas. A lot of people with a lot more experience wouldn't have come up with as sensible a plan as you did. People can debate the particular percentages in the asset allocation, but a mix of low cost index funds will serve you well for the long run.

If you are able to come up with such a sensible plan for your money, I'm confident you can do the same for your career with a similar amount of research and planning. Don't sell yourself short!

Saving$
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Re: Am I in over my head?

Post by Saving$ » Sun Sep 14, 2014 10:16 pm

Katie wrote:I just want to say how impressed I am with your attitude about this money, and the work you've done researching ideas. A lot of people with a lot more experience wouldn't have come up with as sensible a plan as you did. People can debate the particular percentages in the asset allocation, but a mix of low cost index funds will serve you well for the long run.

If you are able to come up with such a sensible plan for your money, I'm confident you can do the same for your career with a similar amount of research and planning. Don't sell yourself short!
This. Absolutely agree.
The key is to come up with a plan. Do not just float.

toto238
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Re: Am I in over my head?

Post by toto238 » Sun Sep 14, 2014 10:22 pm

Saving$ wrote:
Katie wrote:I just want to say how impressed I am with your attitude about this money, and the work you've done researching ideas. A lot of people with a lot more experience wouldn't have come up with as sensible a plan as you did. People can debate the particular percentages in the asset allocation, but a mix of low cost index funds will serve you well for the long run.

If you are able to come up with such a sensible plan for your money, I'm confident you can do the same for your career with a similar amount of research and planning. Don't sell yourself short!
This. Absolutely agree.
The key is to come up with a plan. Do not just float.
I completely agree as well. Your plan is good. There's nothing fundamentally wrong with it. Someone once said (someone help me with the source?) that the greatest enemy of a good plan is the pursuit of a perfect one. If you're 100% in index funds, have an overall 60/40 stock/bond ratio, and have both domestic and international exposure, you're already ahead of 90% of the game. Honestly, just that by itself is perfectly fine. You can stop there, and you'll be ok. Honestly. You can fool around with it and increase things and decrease things if you want, but it's really not necessary. A 60-40 stock-bond ratio sets you up for long-term inflation-beating growth, as well as decent enough stability that hopefully you'll be able to "stay the course" when the going gets rough.

Could you squeeze a little more out of it here or there? Maybe. Could you be more aggressive? Perhaps. But your original plan is fine. If someone tries to sell you on something more complicated or something that will cost you more, be skeptical.

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macchiato
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Re: Am I in over my head?

Post by macchiato » Sun Sep 14, 2014 10:56 pm

Forward wrote: The most important thing to me right now is finding a job. Honestly I don't want to go to college if I don't have to because I don't like learning in a classroom environment. I am much more comfortable on a computer by myself to learn. That being said I do have 14k set aside for college in a state plan and will most likely end up going. Once my girlfriend is finished with college we will most likely move in together wherever she can get a job. Not sure if its a great plan but its what I have right now.
All the financial advice you've received is excellent if you do nothing else.

I would slice off some of that windfall plus your state plan and give yourself a year at college and give it a good go. And don't just live at home, live away from home and live on campus.

"College is an opportunity to stand outside the world for a few years, between the orthodoxy of your family and the exigencies of career, and contemplate things from a distance." Nice bit of wisdom from this article.

As Woody Allen said, 80 percent of success is showing up. Show up to college for a year.

After all, you showed up here and have asked good questions. You are so much better than a $9/hr job. Take some of the money and explore your potential. You won't regret it, and you can always go for an online degree if the campus environment isn't for you.

2stepsbehind
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Re: Am I in over my head?

Post by 2stepsbehind » Sun Sep 14, 2014 11:16 pm

While I agree that the OP should certainly maximize his human capital, there's a bit of a troubling undertone in some of the posts in this thread. Who is a $9 an hour job good for and why is the OP so much better than that?

Ganacel
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Re: Am I in over my head?

Post by Ganacel » Sun Sep 14, 2014 11:53 pm

I'm going to be the dissenting voice about the OP going to college. He doesn't like going to school, and he doesn't have a specific career he wants to train for. In that case, going to college just because that's what people his age are "supposed" to do is a waste of time and money. Don't get me wrong: some people love learning for its own sake, and for them, a four year degree like a liberal arts degree makes sense if they have the aptitude for it and don't know what they want to be when they grow up yet. But this guy isn't in that category.

I do think it makes sense for him to think about what he loves doing, and use that to figure out what career he might transition into based on his interests and skills. Not because there's anything inherently wrong with working a minimum wage job, but because most minimum wage jobs aren't real careers that you love and devote your life to. (2stepsbehind, I think this is what people are trying to say when they're telling him that he's "better than" a minimum wage job.) Maybe we can make some suggestions (including whether he needs any post-secondary training) if he tells us his hobbies. So OP, what do you enjoy doing with your time?

abyan
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Re: Am I in over my head?

Post by abyan » Mon Sep 15, 2014 12:03 am

Yes, but. You could argue that everyone who thinks you should go to college is suggesting that anyone who didn't go to college is somehow unworthy. And I think that would be an incorrect argument. I don't think there's anything wrong with trying to suggest to a 19 y.o. that the world is his oyster, and that while lots of good people make minimum wage for a living, there's nothing wrong, and a lot good, about a teenager aspiring for more.

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Re: Am I in over my head?

Post by yosef » Mon Sep 15, 2014 7:29 am

2stepsbehind wrote:While I agree that the OP should certainly maximize his human capital, there's a bit of a troubling undertone in some of the posts in this thread. Who is a $9 an hour job good for and why is the OP so much better than that?
What troubles you? To answer your question, a $9/hr job is good for a student who is learning a skill that will pay more than $9/hr.

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Re: Am I in over my head?

Post by yosef » Mon Sep 15, 2014 7:35 am

Ganacel wrote:I'm going to be the dissenting voice about the OP going to college. He doesn't like going to school, and he doesn't have a specific career he wants to train for. In that case, going to college just because that's what people his age are "supposed" to do is a waste of time and money. Don't get me wrong: some people love learning for its own sake, and for them, a four year degree like a liberal arts degree makes sense if they have the aptitude for it and don't know what they want to be when they grow up yet. But this guy isn't in that category.

I do think it makes sense for him to think about what he loves doing, and use that to figure out what career he might transition into based on his interests and skills. Not because there's anything inherently wrong with working a minimum wage job, but because most minimum wage jobs aren't real careers that you love and devote your life to. (2stepsbehind, I think this is what people are trying to say when they're telling him that he's "better than" a minimum wage job.) Maybe we can make some suggestions (including whether he needs any post-secondary training) if he tells us his hobbies. So OP, what do you enjoy doing with your time?
I am always very skeptical of young people who say they "don't like going to school". Mostly because college is so much different from high school in virtually every regard. Much less time spent in class, much less homework for homework's sake, etc. You're treated as an adult; the information is presented and it's up to you to learn it - or not. And the experience allows you to "sample" a lot of disciplines and see what interests you in a manner that would be difficult at best to accomplish outside of school. And of course it goes without saying that although there are exceptions to every rule, someone without any post-HS education is severely limiting their career opportunities and earning potential.

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Re: Am I in over my head?

Post by dolphinsaremammals » Mon Sep 15, 2014 8:33 am

Ganacel wrote:I'm going to be the dissenting voice about the OP going to college. He doesn't like going to school, and he doesn't have a specific career he wants to train for. In that case, going to college just because that's what people his age are "supposed" to do is a waste of time and money. Don't get me wrong: some people love learning for its own sake, and for them, a four year degree like a liberal arts degree makes sense if they have the aptitude for it and don't know what they want to be when they grow up yet. But this guy isn't in that category.

I do think it makes sense for him to think about what he loves doing, and use that to figure out what career he might transition into based on his interests and skills. Not because there's anything inherently wrong with working a minimum wage job, but because most minimum wage jobs aren't real careers that you love and devote your life to. (2stepsbehind, I think this is what people are trying to say when they're telling him that he's "better than" a minimum wage job.) Maybe we can make some suggestions (including whether he needs any post-secondary training) if he tells us his hobbies. So OP, what do you enjoy doing with your time?
College would put a large dent in your savings. I would not commit to college unless I knew I needed it for work or I was interested in learning for its own sake or the "college experience." Otherwise blowing a lot of money on college is no different from blowing it on a very expensive car.

If you turn out to be interested in learning but not in college, there are FREE online courses and the local library probably has a book group, etc. Community colleges also tend to be inexpensive and you can probably take an occasional course without enrolling in a program to get a degree.

High schools used to have guidance counselors who would help kids figure out what career interested them. Even though you have graduated, it would be worthwhile seeing if someone there would talk to you about this. I also recall taking some long test (a day long?) in high school that told you what you were skilled at and what interested you.

Besides not squandering your money, the most important thing, I think is figuring out what you want to do with your life. You may change your mind later, but at least you will have a plan.

Maybe you'll be perfectly happy working at a minimum wage job and living with your girlfriend. There's nothing wrong with that.

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Re: Am I in over my head?

Post by Forward » Mon Sep 15, 2014 12:26 pm

I would slice off some of that windfall plus your state plan and give yourself a year at college and give it a good go. And don't just live at home, live away from home and live on campus. "College is an opportunity to stand outside the world for a few years, between the orthodoxy of your family and the exigencies of career, and contemplate things from a distance."
I am always very skeptical of young people who say they "don't like going to school". Mostly because college is so much different from high school in virtually every regard. Much less time spent in class, much less homework for homework's sake, etc. You're treated as an adult; the information is presented and it's up to you to learn it - or not.
My high school career was pretty unusual. I lived with just my dad and he would easily be in different states two weeks a month. I would cook for myself clean for myself and get myself to school. He basically let me do whatever I wanted as long as my grades were acceptable. I took some college courses in 11th grade so I am aware of how they are different. There were two types of days in the college classes. The teacher would stand there for two hours talking then assign some kind of homework. Or you walked in and took a test then read one of the required books till the end of the period. I missed about 50 days of school Junior year because I couldn't stand it and had a car. Senior year I did online and graduated pretty early because I could easily do a weeks worth of work in a few days. I graduated with a 3.6 GPA. I just don't think the classroom setting is for me. As for the college experience, I lived a better "college experience" in high school than many of the kids I see when I visit my friends at University.

I'm going to be the dissenting voice about the OP going to college. He doesn't like going to school, and he doesn't have a specific career he wants to train for. In that case, going to college just because that's what people his age are "supposed" to do is a waste of time and money. Don't get me wrong: some people love learning for its own sake, and for them, a four year degree like a liberal arts degree makes sense if they have the aptitude for it and don't know what they want to be when they grow up yet. But this guy isn't in that category.
If I could find a career without needing college I would be a happy man. I know many people who went to college because that's what they were "supposed" to do and it hasn't worked out well for them. Not all of them but a good enough amount. Spending 12k a year for something I don't want to do just doesn't make much sense to me.
So OP, what do you enjoy doing with your time?
My problem is there is nothing I really enjoy that could translate into a career. Most of my time is spent reading and playing on the computer but things like programming don't interest me. I'd like to answer this question better but I just can't find the right words for it.

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Re: Am I in over my head?

Post by BL » Mon Sep 15, 2014 12:47 pm

Lots of people your age haven't "found" themselves. Use this time to get experiences and sample various types of jobs. I believe a lot of technical colleges have mainly hands-on courses which may be what you prefer rather than studying from books. You are obviously mentally talented and it is just a matter of using your time and concentration to find something you like to do.

Some people find that the military gives them time to mature and experience in various fields where they choose to concentrate. Granted some folks hate it, too, even though many of them also gain from the experience. The National Guard gives some of the same type of experience, while being a civilian most of the time.

Going to a job somewhere else is also an option. Folks are begging for help at two snowmobile manufacturers and an electronic distributor in Northwestern Minnesota ($14/hour without experience), and Western North Dakota has good-paying jobs with a Wild West atmosphere.

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Re: Am I in over my head?

Post by Kosmo » Mon Sep 15, 2014 12:49 pm

I'm generally of the camp that one should not attend college just to get a degree. For most people, that's a waste of time and money and effort with very little return. However, this statement may make the case that you should attend college...
Forward wrote:My problem is there is nothing I really enjoy that could translate into a career. Most of my time is spent reading and playing on the computer but things like programming don't interest me. I'd like to answer this question better but I just can't find the right words for it.
You'll get an opportunity to figure out the answer to this question. Maybe you just haven't been exposed to the right course material or subject matter, or had it explained in such a way that you could make the connection from classroom learning to real world application.

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Re: Am I in over my head?

Post by rayout » Mon Sep 15, 2014 12:57 pm

Forward wrote:
My problem is there is nothing I really enjoy that could translate into a career. Most of my time is spent reading and playing on the computer but things like programming don't interest me. I'd like to answer this question better but I just can't find the right words for it.
If you have enough of a personality, maybe you can start a youtube channel or streaming through Twitch.tv

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Re: Am I in over my head?

Post by tecmage » Mon Sep 15, 2014 1:09 pm

Kosmo wrote:I'm generally of the camp that one should not attend college just to get a degree. For most people, that's a waste of time and money and effort with very little return. However, this statement may make the case that you should attend college...
Forward wrote:My problem is there is nothing I really enjoy that could translate into a career. Most of my time is spent reading and playing on the computer but things like programming don't interest me. I'd like to answer this question better but I just can't find the right words for it.
You'll get an opportunity to figure out the answer to this question. Maybe you just haven't been exposed to the right course material or subject matter, or had it explained in such a way that you could make the connection from classroom learning to real world application.

I felt the same way even after college, so I went into sysadmin and network support instead of programming. It was a lot more hands on and fun for me than programming, so for starting out and liking computers I'd recommend desktop support of some type if you can find it. Or a computer operator job where you run nightly reports, backups etc. A 4 year college might not be a good idea, maybe a community college with more hands on lessons and hopefully some directly applicable classes. You can also keep an eye out for seminars or limited courses that interest you.

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Re: Am I in over my head?

Post by dolphinsaremammals » Mon Sep 15, 2014 1:16 pm

Forward wrote:Senior year I did online and graduated pretty early because I could easily do a weeks worth of work in a few days.
You might want to look at online courses from the more challenging universities. Take a look at Walter Lewin's courses at the link below. Or other stuff if you're more into the humanities.

http://web.mit.edu/physics/people/facul ... alter.html

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Re: Am I in over my head?

Post by surfstar » Mon Sep 15, 2014 1:22 pm

Peace Corp or something similar? Get out and see what the world has to offer. Find yourself / what you want to do before spending time and $$ on college (you can always go later).

Congrats on the lump sum and way more on the ability to handle it for long-term vs wanting to buy a new car, etc like most people would!

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Re: Am I in over my head?

Post by FelixTheCat » Mon Sep 15, 2014 1:59 pm

Forward wrote:I am 19 and received $250,000, currently have a paid off car and no job but I basically live for free. Everyone keeps telling me I should just speak with Financial Advisors and find one who has been doing it for a long time. I feel like I could just make a Vanguard account and do something like 40% total stock, 20% international stock, and 40% bonds. What would the benefits be of me finding a FA that would justify paying somewhere around 1% per year? I understand that if I find a good FIA they would be able to help me with stuff like taxes but it seems like it wouldn't be too hard to fill out a form and send it in.
You can learn everything about investing on the Wiki and by asking questions on this board OR have Vanguard manage the money for about 1/3 of a percent. I suggest leaving the money in a FDIC insured savings account until you know what direction you plan on taking.
Felix is a wonderful, wonderful cat.

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Re: Am I in over my head?

Post by Dandy » Mon Sep 15, 2014 4:39 pm

Your allocation seems fine, even conservative for a 19 year old. You don't need much financial advice but financial knowledge is critical. Please read some or all of the suggested readings to keep your head on straight and above water.

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Re: Am I in over my head?

Post by Ganacel » Mon Sep 15, 2014 4:51 pm

Forward wrote:If I could find a career without needing college I would be a happy man. I know many people who went to college because that's what they were "supposed" to do and it hasn't worked out well for them. Not all of them but a good enough amount. Spending 12k a year for something I don't want to do just doesn't make much sense to me.
I do, too. That's why I agree it doesn't make sense for someone like you to go to college just to pass the time or to "find yourself," especially if you have to go into debt to do it. And I'm saying that as one of those people who loved school (both high school and college) and wants to go back for more.
My problem is there is nothing I really enjoy that could translate into a career. Most of my time is spent reading and playing on the computer but things like programming don't interest me. I'd like to answer this question better but I just can't find the right words for it.
I don't know a lot about computer jobs, but it seems like that's the place to start. There are plenty of other things you could do besides programming, like tech support, sales, systems administration, etc. Unfortunately, I don't know of too many jobs that pay you to read for pleasure. If you come across one, let me know, because I'd like to apply for it too!

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Re: Am I in over my head?

Post by Lynette » Mon Sep 15, 2014 4:58 pm

If you aren't sure, try to get a job doing some type of IT work if that is your passion. Some of the best IT people I know started in a computer room. (Old days :D ). You can always get the college degree when you have made up your mind. In IT, it's about experience.

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Re: Am I in over my head?

Post by Watty » Mon Sep 15, 2014 8:00 pm

One thing that I thought of what that now that you have some assets you should make sure that you have ample car insurance since you are now more prone to getting sued if you are in an accident.

An umbrella policy would be worth looking into too but I don't know what sort of umbrella policy would be available for someone your age.

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