What do two personal finance experts with 60+ years of combined experience wish they knew back in their 20s? A lot, as it turns out.
In this week’s episode of the HerMoney Podcast, Jean Chatzky and bestselling author David Bach sat down to reflect on the financial wisdom they’ve gained, the missteps they’ve made, and the money-saving tips they would have loved to hear 30 years ago.
Here are the top five takeaways that can help you skip the regrets and start building your best financial life now.
Number 1: Automate Everything
If there’s one money-saving tip both Jean and David swear by, it’s automation.
“Anyone who read my book 20 years ago, paid themselves first automatically, and bought a home, chances are they’re a millionaire today. ” David says. Whether it’s transferring a portion of every paycheck to savings, paying down your mortgage automatically, or investing through your 401(k), the fewer decisions you have to make, the better.
“You have to pay yourself first, at least one hour a day of your income,” David says. “So the average American needs to save at least 12 and a half percent of their gross income, which hasn’t changed.”
Number 2: Start Earlier Than You Think
Both experts admit they didn’t start saving or investing aggressively until their 30s, and they wish they hadn’t waited.
“When I was young, I wanted to get rich quick,” David says. “I was trading stocks, and none of those things worked. They never work. I don’t know anybody who’s gotten rich quick. It was compound interest and consistency that actually worked.”
Jean adds, “When I was in my twenties, I wasn’t very conscious of saving. I didn’t feel like I could, and I didn’t really get started until I was in my thirties, and then I had to do a total reset after my divorce in my forties, so twenties would’ve been a nice decade to grab some growth.”
Number 3: Don’t Be Afraid To Take (Smart) Risks
Conservative savers, this one’s for you. Jean admits she left too much money in cash early on and missed out on market growth.
“I’m wired to save a decent amount of money. That’s in my DNA, but I wish that I had been more willing to take more risks earlier and put additional money in stocks. I, like many women, left too much money in cash,” Jean says.
One of the smartest money-saving tips isn’t just about saving cash; it’s about making your money work for you through long-term investing.
Number 4: Build a Real Plan, Not a “No-Plan Plan”
David warns that too many people are winging it financially.
“Most people don’t have a real plan. The problem is if you don’t have a real plan, somebody else has a plan for you,” David says. “And they’re the ones that win. They’re the ones that take all your hard-earned dollars from you.”
That plan doesn’t have to be complicated. It just has to include clear goals: what you’re saving for, how much you’re saving each month, and how you’re protecting what you’ve built (think insurance, a will, and emergency funds).
Number 5: Enjoy Your Money (Before It’s Too Late)
After decades of coaching people to save, both Jean and David agree: the end goal isn’t just financial security, it’s the freedom to live a good, healthy life in retirement.
“Most retirees do not run out of money. What they run out of is healthy life. I’ve seen lots of people start to get sick in their sixties, in their seventies,” David says.
“When you retire, you need to use your health, your time, and your money in the first decade,” David says. “We’ve spent 40 years teaching people to save and invest for retirement. Now we’re on the next part of the journey, which is to teach people how to enjoy their money.”
MORE ON HERMONEY:
- Which Budgeting Method Can Help You Become Debt Free The Fastest?
- From Nest Egg To Paycheck: Rethinking Retirement Planning
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