STAGE 1: The Early Years.
Traditional advice: You’re finally earning a decent income. Now put that money to work for you.
- Buy a home ASAP to begin building equity (aim to put at least 10% down).
- Stash enough in your 401k to get the company match, and tilt heavily towards stocks for growth.
- Start funding a 529 college savings plan as soon as the kids arrive.
Changes to financial system:
Leverage is out; saving more to meet your goals is in.
Don’t count on supersize gains in stocks and real estate going forward.
Expect the market’s sharp zigs and zags to continue.
Right moves now:
Buy that house if you plan to stay in it.
Save for a hefty down payment.
Go all out for retirement.
Smooth the roller-coaster ride.