First, let me say that I really appreciate everyone who reads this blog be they lurkers, regulars and/or commenters.
Second, I got an e-mail from someone fresh out of school and seeking advice on how to get started properly managing her money. My first thought was "She's asking me? She must not read my blog because I do all kinds of dumb things!" But, really, I was terribly flattered, because I'm not so retarded with money as I sometimes beat myself up for being.
Besides, I know a little something, something -- enough to pay off my debts and put some money away and to keep researching to improve my knowledge and financial standing.
I also recognize the importance of helping someone when they reach out to you. I did that a lot when I first started the blog, so I'm more than happy to share what I learned.
Below is a transcript of our e-mails. She asked me some smart questions and I had to comb through my blog for things I did and to recommend some places she find additional resources. There are also bloggers who are much better at this than I am right now, and some of them are listed in my blog roll.
Here's what I shared with the young sister:
Hi Debt Hater,
I am a huge fan of your blog, and riding on the rather high prospect of landing a really good job in the coming week (fingers crossed!) and feeling like life is finally starting for me, I wanted to ask your opinion.
I'm 24 ... I got laid off from my last job about 3 months ago, and during that time was living off savings, unemployment checks, and a few freelance gigs. I have 1 credit card that I'm not using and am paying off, 1 hospital bill I'm trying to pay off, the normal amount of monthly bills, and tons of student loan debt. I started using mint[dot]com over the weekend (have you heard of it? it's great) and in the process, went to freecreditreport[dot]com, which told me my incredibly *average* credit score, and also told me my student loan debt equals ~$40K. Ouch. And that's just undergrad.
With this new job, a lot will change for me. I want to be able to start paying down the loans, and save. Problem is, even though I read your blog and a few others...I just don't know where to START. And I'll be starting from scratch. I want to do this as correctly as possible, with the fewest blunders, and I think that can be achieved with your guidance. So I guess what I'm wondering is:
- which bank is the best to set up my primary savings acct with (best interest rate, least stipulations, etc)? or do you think i should use other routes to save, rather than the normal savings acct?
- what are good guidelines for 401K options, which I'm pretty sure the company will have?
- with the student loans, is it better to pay the minimum amount they suggest, or go up to something higher that i can handle?
- what did you use to create your budget?
- and later down the line: investments? what are the best resources for total beginners?
- any other advice you have to offer!
That's about it. Please let me know what you think, and feel free to ask me any questions you may have. I hope to hear from you soon, have a great day!
These are not little questions. And a lot of them, frankly, I DID NOT know the answers to. But, they were great because they're questions I need to be asking to get myself straight.
Here's what I told Nuri before I dove into my "answers:"
First, I am flattered that you asked me for help. I appreciate your admiration.
Second, just so I let you know up front, I am not a finance professional and anything I share with you is coming from my personal experience. It is not professional advice and, as a result, I could be wrong!
Third, there are few things on your list that you're asking me about that I can't help you with at this time because I'm learning more about them myself! Specifically, investments and 401 k selections. But I have suggestions on where you might find some advice:
So how did I answer her questions? Find out starting in the next post!
More importantly, in the next few posts where I list Nuri's questions and my responses, I'm asking yall to pitch in with advice and recommendations so Nuri can get a broad swath of knowledge. Ultimately, what she decides to do it us to her. I just want help her make the best decisions she can at the time.
Thank you in advance for your help!