Hello class of 2018! In this episode I share with you some wisdom and education to help you or anyone you know who recently graduated. Whether you’ve graduated from high school, college or earned an advanced degree you will want to listen to this episode.

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Highlights

1. Stay away from consumer debt and pay off student loans fast!
2. Don’t finance that car or any other material item.
3. Revisit your goals and adjust as needed.
4. Build your network.

Transcript

Congratulations class of 2018! You have closed one chapter of your life and now beginning a new one. You should be proud! Whether you are graduating from high school, college or any advanced schooling there are going to be financial traps that come your way. And with the right amount of preparation and knowledge you will be able to avoid them.

According to the Federal Reserve the U.S. has seen the largest increase in household debt in almost the last decade. This country finished 2017 with $13.15 trillion in household debt. That’s scary, and although some of you are too young to remember, 2008 was the record for consumer debt ($12.68 trillion) and that was a very difficult financial time for this country. What does all this mean for us today?

Well, we have to teach the next generation to break the habit that many of us fell to, borrowing money. So here’s a few bits of wisdom I want to share with you as you’re starting the next chapter in your life after graduation to make sure you don’t fall into the traps and tricks of the world out there.

Stay away from consumer debt, except a mortgage, and pay any consumer debt off fast! Other than a house I will never recommend that you go into debt for anything. Not school (no student loans), not a car, not clothes, not furniture, not a refrigerator, not a vacation, not to “build credit”…you understand where I am going? When you have no debt there is a sense of freedom in your life and you are able to do what most people in the country wish they could do, but are consumed with all kinds of debts and payments that have to be made. Stay debt free and learn to live below your means.

Don’t finance that car. I understand some people may not agree with me on this and that’s fine, but let me tell you that I will never again finance a car. I did this once and learned my lesson. Save up for the car you want and in the meantime drive around a used, dependable car. Going into debt to get the “car of my dreams” is silly and right now you need to start building wealth. Cars depreciate in value and instead of making payments to something that is losing money everyday, you can be investing in an IRA (check out “Money” in the “Professionals” section for more info on IRAs) or funding your kids education through ESAs and 529s (check out “Funding College” in the Parents section for more info).

Revisit your goals and adjust them as needed. If you know me, when it comes to my career and finances I try to set goals and stick to them. 1, 5 and 10 year goals are critical to help you be successful and you’re going to need these goals for your career, finances, and overall personal self. So yes, you will even need fitness goals.

Also, have a close friend review your goals with you or a financial advisor to provide some good guidance so that you can stay on track. Even at the age of 30, I am working towards goals for myself and my family 10 years from now. That is how you stay focused and successful throughout life. And remember, sometimes our goals need to be adjusted a little and there’s nothing wrong with that. I planned to graduate college in four years and I actually finished in five and a half. My goals needed a little adjustment in college and you will find that you may need to do the same thing, but don’t worry. Stay focused on the long term goals and these little adjustments will be easy.

Build your network the right way. A big key to your success will be based on the people in your life. Who you surround yourself with will have an impact just how far you go in life. Your life is way too precious and awesome to have intertwined with people who are negative and discouraging. Find people who will motivate you and inspire you to better than you are today. I don’t want you to completely terminate your friendships, because I believe you can be the friend that can help change your friends for the better. However, you have to develop relationships with people who are moving in the direction you want and need to go in life.