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Shmoe Rules and Truisms

Updated: May 9, 2021

Following are the most important things to do, to be a true finance shmoe:

  1. Spend less than you earn. That’s the only way to be able to save and invest.

  2. Don’t keep up with the Jones’s. Why should you care?

  3. Don’t take on debt, other than a house.

  4. Don’t buy more house than you need.

  5. Don’t be enamored with expensive “named” colleges.

  6. Don't go into massive debt for a college degree that doesn't give you marketable skills.

  7. Pick a career that a) you can “like” that b) provides reasonable income prospects.

  8. Be realistic about Job Love. You don’t have to “love” your job, and in fact, if you do find a job you love, after doing it for a few years, you’ll only “like” it like any other shiny object.

  9. Your “dream” job, if it doesn’t allow you to make a reasonable living, is a hobby.

  10. A car is a way to arrive somewhere...not a way to make you feel like you’ve “arrived.”

  11. In your job, exceed expectations and do what you say you’re going to do. Seek excellence, even when people aren’t looking.

  12. Have an emergency fund with 6 – 12 months worth of expenses. You’ll feel more secure and less worried, and even “cocky” in a good way.

  13. Don't buy individual stocks unless you have insider information, which is illegal, or if you have a crystal ball or ESP, which you don't.

  14. Instead buy index funds. You can easily achieve financial success with three or four funds -

  15. Do not pay a financial advisor to "manage" your investments. You can and should do it yourself. It's not complicated. You can't beat the market, and neither can a financial advisor. So why give them money for nothing?

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