Comment by sebastiennight

Comment by sebastiennight 4 days ago

The root comment was talking about investing 5% of their earnings. If you're making any kind of income at 17 (which admittedly is not everybody) then learning to save+invest a small portion of that can have incredible positive snowball effects beyond the compounding itself.

I can't imagine a scenario where at 55 years old, you would miss the 5% of your summer income you invested back in high school. But I can totally see a scenario where investing those 5% led you to increasing it to 10% in college, 20% on your first job, and being financially independent way before you hit the age of 55.

lukan 4 days ago

"I can't imagine a scenario where at 55 years old, you would miss the 5% of your summer income you invested back in high school."

If those 5% were the question of whether to go with the group on a adventure together or not - and you end up alone at 55 years and not invited .. you might have rather invested different back then. But on the other hand I don't think those 5% of earnings with 17 make a difference later.

The only real difference they can make, if they made you start a habit of saving income for important purchases. (But not really fore retirement at that age. But each to his own)

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lurking_swe 4 days ago

I think this really comes down to how a teenager is wired and life circumstances. Some of us made all our close friends in college and dont even live near our hometowns anymore. My high school friendships are all “dead” so to speak.
I think if a teenager is the social type, or they have a positive (non-toxic) friend group, then absolutely - spend the money! It’s an investment in your friends that may or more not pay off.
But some teenagers don’t have much in common with their peers, are bullied in high school, or just want to move on to the “real world” and graduate already. For those kids, invest!

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- lukan 4 days ago
  
  "or just want to move on to the “real world” and graduate already. For those kids, invest!"
  In general sure, it really depends .. so invest in what? It can mean many things, like also saving for the drivers licence/first car to make that move away into a nicer worlds with better opportunities.
  
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  lurking_swe 4 days ago
  
  absolutely! It’s always a good idea to write down your life goals and major planned expenses. Then you can prioritize them as needed.
  That usually helps answer questions like “if i invest X% of each paycheck into an S&P500 index fund, and put the remainder toward saving for my 1st car, i’ll have money for the car by date Y.”
  And this skill translates to adult life really well. I find myself doing just that a couple times a year! Of course for some teenagers investing a substantial amount is simply not realistic…not every family is middle class after all.
  One important reminder: inflation is no joke these days. I’d only recommend a savings account to a teenager for short term goals. Even if they are poor.
  
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bluGill 4 days ago

Most 17 year olds have very low income and education goals. They will miss that 5% in a retirement fund because they are forced to take a student loan to cover that.

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sebastiennight 4 days ago

Forgive my puzzlement, as I come from a country where you would not consider taking a student loan (if this even existed) to cover the $50 you put into an ETF from your summer job.

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- bluGill 4 days ago
  
  Eventually you just don't have enough. If are short $50 where does it come from?
  
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