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Financial Rules for New College Grads: Invest before Paying Off Debt―and Other Tips Your Professors Didn't Teach You
An indispensable guide for any recent graduate that provides simple, easy-to-follow rules for making smart personal finance choices during the first decade of one's career.
Having graduated from college with a degree, even the luckiest newly minted professionals―those who are able to quickly find a full-time job and support themselves―are often burdened with thousands of dollars in student loan debt. Many of these young professionals grow up hearing that they should not invest until their debt is paid off. Others fall too readily for investment scams or the siren call of instant entrepreneurship. Still others don't invest at all.
From financial expert Michael C. Taylor comes a proposed means by which to not only pull oneself out of debt but to start building wealth from the first day on the adoption of modesty, skepticism, and optimism. The Financial Rules for New College Graduates explains that by embodying modesty, the opposite of status-seeking ostentation; skepticism, the ability to recognize scams, false promises, and the hyperbole and short-sightedness of financial media; and optimism, the belief that financial security can be yours with little to no risk, anyone can attain financial security. The early chapters address the role of interest rates, compound interest, and discounted cashflows, while the remaining chapters explore each of the most consequential personal finance choices that recent graduates will make in the first ten years of their career.
Having graduated from college with a degree, even the luckiest newly minted professionals―those who are able to quickly find a full-time job and support themselves―are often burdened with thousands of dollars in student loan debt. Many of these young professionals grow up hearing that they should not invest until their debt is paid off. Others fall too readily for investment scams or the siren call of instant entrepreneurship. Still others don't invest at all.
From financial expert Michael C. Taylor comes a proposed means by which to not only pull oneself out of debt but to start building wealth from the first day on the adoption of modesty, skepticism, and optimism. The Financial Rules for New College Graduates explains that by embodying modesty, the opposite of status-seeking ostentation; skepticism, the ability to recognize scams, false promises, and the hyperbole and short-sightedness of financial media; and optimism, the belief that financial security can be yours with little to no risk, anyone can attain financial security. The early chapters address the role of interest rates, compound interest, and discounted cashflows, while the remaining chapters explore each of the most consequential personal finance choices that recent graduates will make in the first ten years of their career.
- GenresFinance
216 pages, Hardcover
Published April 12, 2018
5 people are currently reading
48 people want to read
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Displaying 1 - 4 of 4 reviews
May 24, 2018
It’s really great to read a book about personal finance like this one that is succinct while still covering a broad range of important topics. This book shows through simple math and simple (but certainly not easy) steps how it’s possible to build wealth provided one starts early enough.
And as a Gen Xer who was told since age 21 by the media and popular culture that I would make less than my parents and have a way worse lifestyle, I’m not buying any of this learned financial helplessness that is in vogue these days on Twitter.
People freaked out when Bloomberg News tweeted that by 35 you should have twice your salary saved. (True, by the way.) I also see people posting their high-interest student loan balances on Twitter like a badge of honor. And anyone who replies to those tweets with a helpful suggestion gets shouted down.
I get it, comrades: Present day America is a late-stage capitalist hellscape. I’ve read the books. I listen to the podcasts. But at some point one needs to take responsibility for one’s life. Whining on Twitter is bad praxis.
So the thing I like most about this book is the calm, clear-eyed sense of agency throughout.
A lot of time is spent on learning to calculate compound interest and the present value of future money. At first this kind of threw me off, because I hadn’t seen a finance book do this — except for a financial math book — but it makes a lot of sense because almost all of the subsequent advice follows logically from these concepts.
The next section covers a lot of material: getting out of debt, budgeting, borrowing, buying a car and a house, and retirement accounts. While there is a lot of good information, what I liked most about this section is that there is an emphasis on how to think about these topics and useful attitudes to have towards them.
As an Orthodox Boglehead, I was a little shocked when the next section recommended going 100% into stocks. I’m inclined to think about asset classes (just bonds and stocks for me, thank you), getting the allocation right, and balancing periodically.
Mr. Taylor cuts through all that and posits that stocks are the safest bet over a long period so go all in, with some important caveats of course. At least I don’t feel so bad for letting my allocation get so out of whack.
I was also surprised that he felt 95% of people need a financial advisor. My experiences have been so horrible and costly, that I’d say more like 5% do. I like his test for weeding them out, but I hate the thought of anyone who is feeling insecure about their finances going anywhere near one of them.
As for new stuff I learned, I’m definitely going to check out donor-advised funds. I’m on a mailing list that discusses them, but I sort of tuned it out. I also liked the Roth IRA trick. (Un)fortunately, I haven’t been in a position to donate much to a Roth.
I completely agree with his view that children and family shouldn’t expect to inherit any money. If I can pass down healthy attitudes towards money and saving that would be far more valuable in the long term than any sum.
I think it’s a toss up between this and Bernstein’s The Investor’s Manifesto for what I would have my niece/nephew/daughter/son read right after college graduation.
Highly recommended. It can be read in an afternoon and you’ll know more than 99% of Americans do about how to think about money and become wealthy.
And as a Gen Xer who was told since age 21 by the media and popular culture that I would make less than my parents and have a way worse lifestyle, I’m not buying any of this learned financial helplessness that is in vogue these days on Twitter.
People freaked out when Bloomberg News tweeted that by 35 you should have twice your salary saved. (True, by the way.) I also see people posting their high-interest student loan balances on Twitter like a badge of honor. And anyone who replies to those tweets with a helpful suggestion gets shouted down.
I get it, comrades: Present day America is a late-stage capitalist hellscape. I’ve read the books. I listen to the podcasts. But at some point one needs to take responsibility for one’s life. Whining on Twitter is bad praxis.
So the thing I like most about this book is the calm, clear-eyed sense of agency throughout.
A lot of time is spent on learning to calculate compound interest and the present value of future money. At first this kind of threw me off, because I hadn’t seen a finance book do this — except for a financial math book — but it makes a lot of sense because almost all of the subsequent advice follows logically from these concepts.
The next section covers a lot of material: getting out of debt, budgeting, borrowing, buying a car and a house, and retirement accounts. While there is a lot of good information, what I liked most about this section is that there is an emphasis on how to think about these topics and useful attitudes to have towards them.
As an Orthodox Boglehead, I was a little shocked when the next section recommended going 100% into stocks. I’m inclined to think about asset classes (just bonds and stocks for me, thank you), getting the allocation right, and balancing periodically.
Mr. Taylor cuts through all that and posits that stocks are the safest bet over a long period so go all in, with some important caveats of course. At least I don’t feel so bad for letting my allocation get so out of whack.
I was also surprised that he felt 95% of people need a financial advisor. My experiences have been so horrible and costly, that I’d say more like 5% do. I like his test for weeding them out, but I hate the thought of anyone who is feeling insecure about their finances going anywhere near one of them.
As for new stuff I learned, I’m definitely going to check out donor-advised funds. I’m on a mailing list that discusses them, but I sort of tuned it out. I also liked the Roth IRA trick. (Un)fortunately, I haven’t been in a position to donate much to a Roth.
I completely agree with his view that children and family shouldn’t expect to inherit any money. If I can pass down healthy attitudes towards money and saving that would be far more valuable in the long term than any sum.
I think it’s a toss up between this and Bernstein’s The Investor’s Manifesto for what I would have my niece/nephew/daughter/son read right after college graduation.
Highly recommended. It can be read in an afternoon and you’ll know more than 99% of Americans do about how to think about money and become wealthy.
September 2, 2018
Tips your professors didn't teach you? Were they supposed to? Mom taught me to balance a checkbook (thanks Mom!), but after graduation, the leap into the world of adult finances was always daunting and intimidating. The Financial Rules for New College Graduates cuts through the confusion. This stuff is not hard, and that's saying something coming from an artsy fartsy English major.
I highly recommend this book for those just cut from the apron strings or anyone in need of a primer on financial basics. Michael Taylor encourages even money dummies that they can build wealth with a solid foundation of sober, steady financial habits. As a 20-yr-old noob, I could have used practical advice in areas that were Greek to me: retirement saving, investing, insurance, house buying, etc. I would buy this clear, conversational, even fun (in a nerdy way) book for any new grad or any old grad who needs help planning beyond the next paycheck. Also, it's funny. Do you like Jack Handey quotes? Lord of the Rings references? Why have you not bought this book yet?
I highly recommend this book for those just cut from the apron strings or anyone in need of a primer on financial basics. Michael Taylor encourages even money dummies that they can build wealth with a solid foundation of sober, steady financial habits. As a 20-yr-old noob, I could have used practical advice in areas that were Greek to me: retirement saving, investing, insurance, house buying, etc. I would buy this clear, conversational, even fun (in a nerdy way) book for any new grad or any old grad who needs help planning beyond the next paycheck. Also, it's funny. Do you like Jack Handey quotes? Lord of the Rings references? Why have you not bought this book yet?
July 2, 2018
Outstanding, succinct, and at times laugh out loud funny book about personal finance that has lessons for everyone, including me. Spoiler alert: I am neither a recent college grad nor prone to reading books about finance, but I loved this book. Also- it makes a great graduation present!
June 27, 2024
I opened a ROTH IRA because of this book. It’s easy to follow along as a person that has 0 and ABSOLUTELY zero finance knowledge, I felt like this was a good starting point. Honestly may need to go back and read a couple of chapters since I did not take the time to actually do some of the exercises the author wanted us to follow along. All in all not bad, I’d give it a solid 3.5/5
Displaying 1 - 4 of 4 reviews