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To the Class of 2023

Over the last several weeks thousands of high school and college graduates have earned their ticket to the next phase of life. Some will move on to additional education and others will enter the workforce. In either case, graduation is a unique point in time. It is one of the only times where one phase is very clearly ended, and a new phase is very clearly set to begin.

My daughter was among the high school graduates. After her graduation ceremony we went to a local restaurant to celebrate her accomplishment. As we waited for our meal, we went around the table with each person offering her a single piece of advice. I wouldn’t say anyone offered her any particularly “sage-y” advice but after each person spoke we all nodded and said “ohh that’s a good one”. There is something to be said for repeating good advice at the right time.

With that in mind, I offer our most recent graduates three pieces of financial advice/ reminders.

1. You are on your own journey. You’ve made dozens of decisions that have resulted in successful matriculation from high school/ college and you’ve laid the foundation for your own personal next step.

Everyone else around you has also made dozens of decisions to be successful. And, there’s a better than average chance that most of your decisions were different from the others around you. Perhaps your goal was trade school while your best friend’s goal was to attend a top tier university. Your educational decisions were different from your best friend’s and you both are on track to achieve your definition of success.

Financial decisions are similar. Recognize that your hopes and dreams of today and tomorrow are different from those around you and make your everyday money decisions with this firmly in mind.

Stated plainly - don’t try to “keep up with the Joneses”. The Joneses' journey is not your journey.

2. Save something from every paycheck or gift. The common rule of thumb is to save 10%. That’s a great rule and, if you can do it, you’re likely to have the money you need for future needs and wants.

But, if you don’t already have a habit of saving 10% that might be a major adjustment. Instead, start the habit of saving by saving SOMETHING. For every paycheck or gift you receive, set aside $1 or $5 or whatever amount is easy. Put it in a sock drawer. Or in a savings account. The details don’t matter as much as it matters to start the habit of knowing that you cannot spend every dollar of income when you receive it.

No matter how little you earn, there is always a way to save just $1 from a paycheck. If you can’t save it for a long period of time, work to get by with holding that $1 from the current paycheck until after the next paycheck.

This piece of advice isn’t about building wealth today. It’s about building the habit that can help lead to wealth later. Start small. Be consistent.

If you’re already a saver, then challenge yourself to save just a little more.

3. Invest in today AND for tomorrow. While the habit of saving something from your paycheck might mean giving up something for some period of time, it’s important to remember that the purpose of having money is to improve our lives and the lives of those around us.

Saving for the sake of accumulating money isn’t the goal. Saving to buy something or an experience that you will enjoy at a later point in time is the goal. Be proactive in deciding how to use your savings to enjoy your life today while also keeping in mind that you will want to do something fun next week/ month/ year/ decade.

The key is to be PROACTIVE - not reactive. DO save for a night on the town and then go have fun (responsibly). DO NOT simply join your friends for an impromptu ski weekend if it wasn’t already on your list of financial goals you have funded.

K.I.S.S - Keep it Simple [and] Short

That's it. Nothing here is new but sometimes we just need the right reminder at the right time. Sometimes money is complex and confusing. As graduates move from education goals to larger life goals the kind of financial advice I would offer is much more complex. But, for now, this advice is meant to build healthy habits and a good foundation for what’s to come.

Congratulations Class of 2023!



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