I am just a kid, and althouygh I have roughly $4,000 in savings, I want to be able to propser in this climate. I am thinking of buying 3oz gold, as I estimate this will cost ~$3,000, and I works as many jobs to make as much money as I can, but we all know that the economy as a whole, well, sucks. Any suggestions? Espewcially the best place to buy gold?
February 17 - 1600 - Giordano Bruno is burnt alive by the catholic church. Aquinas : "much more reason is there for heretics, as soon as they are convicted of heresy, to be not only excommunicated but even put to death."
Just a kid?
How old are you?
Are you in high school or University?
Do you have any credit card debt or student loans or car loan?
Do you live at home with your parents?
Do you have a job? and where?
16
High School
Nope
Yep
Working with rec leagues, make $100-$200/wk.
First piece of advice: listen to people's suggestions but only do with your own money (and life) what you think is right. If that means going against what everybody else tells you to, then so be it. Just remember to carefully consider all of your options, weigh up the pros and cons, and consider how realistic your expectations are, before you take any action.
Now that you've read the 'disclaimer', here's my proper advice...
Figure out your financial and life goals.
Once you've done that, it will be much easier to work out what your options are.
You say you want to prosper in this climate. What does prosperity mean to you? Become rich? Meet lots of exotic girls? Get a good education?
Also, without knowing your circumstances; whether you live with your parents, etc -- it's impossible to give specific advice.
As Mr. Jones said, what you should do really depends on your specific situation. Considering your age and amount of money, you won't be getting rich off that amount unless you were willing to make a really high risk investment - which is essentially a gamble. I don't recommend this for your situation.
Prosperity really comes down to quality of life. You can buy gold to protect monetary assets in the event of high inflation. Typically the rule of thumb is to put around 20% of your capital into gold. That's just less than an oz for you. However, given your situation, you can't prosper by owning gold. You can only prosper by the ability to sell the gold in the future and get the same or more life improving items that you could buy today with that same amount of money.
1) I don't know if you plan on going to College/University or to do some type of trade or diploma course after highschool. If your parents have the means to pay your way then you are lucky. If they don't then keep your money to go towards your college education. If your education gives you the skills or knowledge to get a good paying job then your college is the single most important investment you will ever make in your life. I mean, don't do Art History or something that will land you a job at McDonalds. In this climate you're best off doing something like Engineering or something in the Medical field or even if you train to become a carpenter or plumber or mechanic. These are all jobs that pay a salary that will allow you to live a comfortable life. Invest in yourself. Books and tuition are expensive and you want the least amount of student loan when you graduate. You will live a prosperous live if you have a prosperous career.
2) We may be in the current economic depression for several years to come. If you are living at home for the next few years and given your parents / family's financial situation you may want to save your money for them. If either of your parents loose their jobs and if they don't have enough savings to get through the depression then you may be able to help them out with some bills.
3) If you don't own a car but will be needing a means of transportation to/from work or school then you could consider buying a good USED car. Again, this depends on your situation. If you live in a city then you will probably financially better off to take a bus or ride a bike than having to pay for gas, insurance, parking, maintenance (oil,tires,brakes) etc.. which are all additional expenses you avoid by taking public transportation. If you need a car and your parents provide one for you then you are lucky.
4) Spend some of your money to have some fun. If you save every dime you earn then maybe this would be a good time to enjoy some of it. Spend a bit of it on yourself considering this is a time in your life where you have no bills, no responsibilities and are capable of having some fun. If your friends decide to go for a road trip or travel to some city you've never been to then go. Take a small adventure and enjoy your youth before the responsibilities of adult-hood kick in.
5) If you are afraid that the gov't activities to manipulate or money supply will create high inflation (in the future) where you will get to buy less with your money (because interest rates won't track inflation) then buy some things you think you will be needing in the future today. If you're moving out and will be needing some furniture then it's not a bad idea to check out CraigsList for some houses that are having moving sales due to foreclosures. There's lots of dirt cheap furniture out there now and this is something that can be considerably expensive for someone first moving away from home. TV's, Couch, bed, dresser, Shelves, Tools, etc.. all things you will need in the future that you may not own today. Ikea also has some cheap furniture. Other things I can think of you may need in the future are: clothes, batteries, sports equipment, .. use your imagination.
Considering your family's financial situation, your parents may or may not be willing to provide some of the above for you. If they do then you are lucky. Because they are willing to doesn't mean they should. One of the qualities that makes you an adult (some day) is the ability to take care of yourself and to stand on your own two feet. Just because someone else will buy something for you doesn't mean they should. There's no better feeling than earning something for yourself and being able to enjoy it with no strings attached. That is true freedom and independence.
This is a fantastic question and some great answers. And you sound like you’ve really got a jump-start on things. So this may be out of left field, but here's another idea: How about starting a small business part time? The capital you need is already in hand. The point of staring your own business is partly that you can make your cash grow, (and maybe even provide a source of income that can carry you through college.) But more primarily, it is to learn how to think like an entrepreneur. If it were me, and I were 16, I’d take about a third of the funds and start a business – maybe something online? – take a third and invest it, and keep the other 1/3 in cash. Provide a product or service you are excited about and learn the ropes of being a businessperson. Just make sure it’s not capital intensive, and will not take too much time or energy away from your schooling and lifestyle. Just my 25 cents worth. (inflation, you know)Find a career that is your calling. And if business appeals to you, you can be blessed financially. No job will ever pay you as much as you can make if you are an entrepreneur at heart.
Ludwig von Mises Institute | 518 West Magnolia Avenue | Auburn, Alabama 36832-4528
Phone: 334.321.2100 · Fax: 334.321.2119
contact@Mises.org | webmaster | AOL-IM MainMises
Mises.org sitemap