Lately, I’ve been having conversations with my kids and their friends about money. Most everyone they know in their age range (20s-30s) is worried about paying off college loans, finding better paying jobs, and managing housing costs here in the Bay Area.
I know that others are having similar conversations with their kids in many other parts of the country. Most of these young people believe they will never be able to buy their own home, at least not in the cities where they grew up.
There isn’t a lot of advice I can offer about that problem, but I do point out a few things about their daily habits that have financial implications over time.
For example, buying a specialty cup of coffee every morning on the way to work costs about $7, which adds up to $1820 a year. Making the same cup of coffee at home costs maybe 50 cents, once you have the equipment (a nice birthday gift from you parents), or about $130 a year.
That’s a net of $1690 a year, which if you invest it in a tax-free retirement account at 7% interest will build itself into $183,600 over 30 years. I always add that if their employer offers a match, take it — it’s free money. A 50% match, for example, would increase that IRA to $275,400.
Call this the “home coffee retirement plan.”
But I also recommend classifying the expense differently when we’re talking about going out for coffee with a friend or colleague. Now that $7 (assuming you go dutch) can be seen as an investment helping to build and strengthen your network, which is where your next job will most likely come from.
Investing in yourself is the opposite of indulging yourself, if you’ll forgive the judgement; either way, the coffee tastes just as good!
P.S. Of course you can knock holes in my story, it’s just a way to encourage long-term thinking in young people who are more likely to be focused, naturally, on the day-to-day.
HEADLINES:
The New Dark Age (Atlantic)
Trump to End Federal Contracts With Harvard University (Bloomberg)
Within Pete Hegseth’s divided inner circle, a ‘cold war’ endures (WP)
Trump Threatens NPR and PBS (New Yorker)
Corporate America's retreat from DEI has eliminated thousands of jobs (NPR)
VA employees are ‘fearful, paranoid, demoralized’ as officials share few specifics to axe 83,000 employees (Independent)
Texas close to requiring Ten Commandments in public school classrooms (WP)
There's a big reason why the bond market hates the tax cuts laid out in Trump's "big, beautiful bill," experts say. [HuffPost]
As Trump reignites a trade war and faces a bond market revolt, the economy is about to go through the wringer this week (CNN)
Trade Crime Is Soaring, U.S. Firms Say, as Trump’s Tariffs Incentivize Fraud (NYT)
Putin is playing with fire, Trump says (Reuters)
Trump Condemns Putin’s Killings in Ukraine, but Doesn’t Make Him Pay a Price (NYT)
India and Pakistan's drone battles mark a new arms race. (Reuters)
King Charles III says Canada facing unprecedented challenges as Trump threatens annexation (AP)
Trump administration orders US embassies to stop student visa interviews (Guardian)
Controversial US-backed group says it has begun aid distribution in Gaza (BBC)
17 EU countries sound alarm over Hungarian LGBTQ+ laws (Reuters)
RFK Jr. says COVID shots no longer recommended for kids, pregnant women (NPR)
Scientists identify a 'very odd' new sea monster, unlike any previously known (Earth.com)
Planet’s darkening oceans pose threat to marine life, scientists say (Guardian)
Meta Overhauls Generative AI Group (The Information)
‘Advertising Doesn’t Work On Me,’ Says Chosen One Who Will Lead Humanity Out Of Dark Age Of Commercialism (The Onion)
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