I recently had a conversation with a successful billionaire money manager about personal finance.
I asked this investor for the best money advice they would give to someone my age.
I’m 27, so this advice would probably be useful for most millennials — anyone aged 19 to 34.
Here are the key takeaways:
- Set up an emergency fund. This means you need to make sure that you have enough money in the bank to cover six months worth of expenses. This doesn’t mean you have to have six months worth of paychecks in your account, but rather enough funds to cover things such as rent and food. That money would be useful if you find yourself out of work or faced with something such as an unexpected medical bill.
- It’s imperative that you complete the first step of establishing an emergency fund before you even consider investing.
- When you do invest, it’s best to pick ten stocks for companies that have an easy-to-understand business, generate cash flow, and pay dividends.
- Avoid putting your money into a private company, especially if you’re a first-time investor.