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Credit Cards With Bad Credit – Sharing From Successful Investors: Investing Secrets I Would Tell My 25-Year-Old Self | Zoom Fintech

Bad Credit Cards – Sharing Successful Investors: Investing Secrets I’ll Tell Myself at 25

Do you know that old adage that hindsight is 20/20? If we were all able to find a time machine to go back to our mid-twenties and start our investment journeys all over again, we know one thing for sure: we would be very wealthy at this point in our lives!

It’s great to learn from past mistakes, but if you made them, it’s hard to go back and correct them. To guide you to investment success, three veteran Fintech Zoom contributors share valuable advice on what they would do back then if they knew what they know now. By learning their lessons, you’ll avoid repeating their mistakes and have an easier path to retirement glory.

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Go invest, kid!

Eric Volkman: The only (open) secret I would tell Eric in his mid-twenties would be to simply invest. Invest now and don’t wait. I was 27 when I bought my first stock (Brno Trade Fairs in the Czech Republic, in case you were curious) while working for a European investment bank.

But there was no reason to hold out for so long. I had been interested in stocks, in particular, and finance, in general, for years, and I had enough of an analytical mind to identify promising investments. I was far from rich, admittedly, but there were slices of disposable income here and there that could have been used to buy securities.

Yes, Eric, at 25, was still a few years away from the dot-com frenzy of the late 1990s/early 2000s, and some time after that, the long-tail bull run that followed the financial crisis. . Still, there were good stocks to be had (as there are in almost every era I would say now).

In my 25s, for example, the mainstay of consumer goods Estee Lauder went public at $26 a share – I could have afforded 10 or 20 shares even in the lean days. If I had shelled out $520 (plus trading commissions – remember?) for that last amount and had done my usual buy and hold, these days I would be sitting on over 23,163 $. That’s not bad at all for a few hundred dollars of a post-college kid’s money.

Many finance professionals warn that good investing is not for the immature. The more experienced and knowledgeable an investor is, the more likely he is not to waste his money on a useless investment. There’s something to it, but ultimately it’s knowledge that can be learned even by very young people, and stock picking is a skill that can be perfected with practice.

If you’re of a “tender age” and have a few dollars burning in your pocket, open an account at a brokerage – which can be done with just a few clicks on a smartphone these days – and invest! If you’re motivated and knowledgeable enough, there’s little downside – $520 is what some people spend on takeout every month – and every reason to start “early”.

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Avoid debt or pay it off quickly

Barbara Eisner Bayer: When I was 25, investing was the furthest thing from my mind – because I was too busy managing and racking up debt. And owing money means not being able to invest, which deprives any 25-year-old from enjoying the power of capitalization.

Not only did I have several college loans that I was paying off, but as an aspiring singer/actress from New York, I wasn’t making enough money to afford everything I needed to succeed in my career, including rent, tuition, portraits, clothing, lessons and travel expenses when I have scored an interpretive job. You see, I didn’t want to deprive myself of whateverso I turned to the almighty credit card to buy what I wanted.

This led to crushing debt. And because I was spending all the money I made, I only paid the minimum amount on my credit cards, which put me more and more in debt. I was like that little hamster going around in circles in the wheel of its cage – always working hard, but never getting anywhere.

Obviously this indebtedness meant that there was no money to invest, because all the money I had was used either to buy the things I needed or to pay off the debt . But even when I reduced what I owed, I usually got into more debt. It was a vicious circle – with the emphasis on the word vicious.

It took me until my mid-thirties to get rid of all my debts – and that was thanks to Dickens’ benefactors – my future in-laws – who didn’t want me to start my married life with such a burden. financial. I had constantly prayed that if I ever found a way out of debt, I had promised never to get back into that again, and to this day, even though I have used debt wisely via mortgages, 0% credit cards and home equity lines of credit, I’ve never been in a situation where I couldn’t cover it with funds in my savings account. It was just another financial tool that I could use to positively manage my financial life.

Once I was debt free, I was able to begin my investing journey and was lucky enough to accumulate enough nest egg to have a happy and carefree retirement. But if I could have started investing a decade earlier, my nest egg would probably be double what it is today.

If you are in debt, make a plan to get out of it. With a little discipline and perseverance, it is possible. You may not have fairy in-laws like me, but you CAN get out of debt if you think about it.

Pink piggy bank sitting next to a jar that says ROTH IRA on a beige table.

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Get your retirement money in a Roth-style plan

Chuck Saletta: When I started working full time, my employer didn’t offer a Roth style 401(k), only offering a traditional type plan. Recognizing the importance of starting early when it comes to retirement savings, I invested in the plan around the time I first became eligible to start building that valuable nest egg.

The benefits of this decision were that it allowed me to take advantage of funding early in my career and put my retirement savings on autopilot. The big downside, though, is that all of that money — and its growth — is on its way to being fully taxed as ordinary income when I withdraw it in retirement.

On top of that, since withdrawals from traditional retirement accounts are considered income, withdrawing money from this plan could increase my health insurance costs and subject my Social Security benefits to taxes. At some point in retirement, these additional taxes and costs may become unavoidable. From age 72, minimum distributions required To obligate money to withdraw from traditional retirement accounts.

In the wake of all of this, if I could go back in time, I would urge my 25-year-old self to figure out how to ask my employer to come up with a Roth-style plan at the time. That way, I could have started contributing much sooner, and that money would be compounded for my tax-free retirement.

Instead, I’m very grateful for the nest egg I’ve been able to build, but also very aware of the tax and financial implications I’ll face once I reach retirement age. A Roth-style 401(k) has since become available to me, and I am now bringing fresh money into it. Additionally, I also expect to start converting my traditional style 401(k) money into my Roth IRA over time once I retire and stop making a paycheck.

Although this move is taxable, it will likely be at a lower tax rate than I would be facing now, as I would not have earned any income pushing these conversions into an even higher tax bracket. It will also reduce the risk of these higher Medicare costs and Social Security taxes, since Roth IRAs are not subject to the required minimum distributions during the account holder’s lifetime.

This article represents the opinion of the author, who may disagree with the “official” endorsement position of a high-end fintech advisory service Zoom. We are heterogeneous! Challenging an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and wealthier.

Bad Credit Cards – Sharing Successful Investors: Investing Secrets I’ll Tell Myself at 25