Russ Lowry explains why trying to match others' spending habits costs you decades of wealth. A new car loses 20-40% of its value in the first two years, and college debt of $100,000-$150,000 against a $40,000 starting salary forces years of payback. Start saving early or you'll be catching up at 40.
Questions this video answers
20–40% (first year or two)
"$100,000–$150,000" in student debt vs a "$40,000" a year job
If you wait until about age 40–45 to start serious retirement saving, you lose a lot of years.
Chapters
Here's something to think about too. Keeping up with the Joneses, as we call it, as I've grown up, trying to do stuff just like your friends do. They get out of school, they get a little bit of money in their pocket, the next thing you know, they're buying a new car, buying a new house, lots of stuff. And trust me, when you get to 57, almost a lot of stuff that mean a lot, you look back and think how much money you've wasted. Save for your future. Buy nice things. Buy once, cry once, I like to say. So I'm not saying don't buy things that are nice, but you don't have to have a brand new car. You know, cars, the value of a car drops off tremendously the moment you drop it off the lot. The first year or two, you might lose 20 to 40% of the car's value. You know, by year five, it stables, stabilizes off and you can look at the cars and, and research that stuff what you want, but buy good, solid, reliable vehicles things, but don't go into debt for that because you're a slave when you're a debtor and you owe so much and you just, it's crushing. So I've done a really good job of staying out of debt. Luckily, we've been successful in business. We're keeping you guys out of debt, paying for your school when we can. Or you guys, like Riley, you know, has scholarships and Jack's going to VO Tech. Not wasting money like a lot of guys come out of OU with 100, $150,000 in debt and are working for a $40,000 a year job. Doesn't make sense. So do the math and that kind of stuff, but always look at your expenses. Try to live below your means. Save money. Trust me, the days are long, the years are short. So you look up and you think, wow, I should have saved more money because I might live a little bit longer than I thought. Those all come into play and Hindsight might be 2020, but if you wait till you're 40 or 45 years old to start really saving for your retirement, you lose a lot of years. So live on less than you make. Don't try to keep up with everybody. The best friend to have is a friend with a boat, because you don't want to own one of those yourself for sure, or a lake house. So like I said, save money, live, have nice things. But you don't need a giant house like we had when you guys were growing up. That was really even too big for that. It's a cause of stress and tension trying to support that you know kind of house Note sometimes again you want to have nice things but you have to think about the long term. What do you do with that that you sleep there, you live there and you eat there have nice places in your house but you don't need a lot of extra room just because your neighbors are just because you want to live in a fancy neighborhood because trust me I've been there. I mean it was affordable we made good money but I would sure like to have another 10 or $20,000 a year in my 401k or IRA or savings or bought some more rental property than live in a big house. So that's the tip for today live below your means. Don't try to keep up with everybody else. Let others make mistakes. Be smart with your money. Save save for a rainy day but enjoy life as well. Take those trips.
