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Advice on money from a teenager who opened a retirement account as a 14-year-old and wrote a book as a 16-year-old

Advice on money from a teenager who opened a retirement account as a 14-year-old and wrote a book as a 16-year-old

Gen Z personal finance expert Ella Gupta started investing at 10 a.m., opened a retirement account at age 14 and wrote her book, “Gen Z Money $ ense: A Personal Finance and Investing Guide,” at 4 p.m. Now Gupta is on a mission to educate tell other members of Gen Z about money and help them get on a smart financial path early in life.

a woman smiling at the camera: Ella-Gupta-gen-z-logo

© Ella Gupta

Read: A look at Gen Z’s financial habits, from consumption to savings and more

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See: 5 Economic Steps Gen Z Should Take Now

GOBankingRates chatted with the Greenlight Ambassador to get her best money advice to other members of her generation, and she shared her top tips for investing for long-term success, finding reliable personal financial advice, and avoiding common money mistakes.

How can children and teens invest in long-term success?

Children and teens should start investing early for long-term success. Consider investing in index funds. These may seem pretty vanilla, but boring is often best when it comes to investing. Consider supplementing cheap index funds with fractional fractions or pieces of whole stocks and mutual funds. Fractions are a great way for teens to get their feet wet in the investment world without a large sum of money. Greenlight’s investment platform allows children and teens to invest as little as $ 1, so you can start small and build as your confidence grows without taking big risks.

Explore: Crypto and 5 other groundbreaking investment trends for Gen Z.

What are some good sources of investment advice? Can young investors trust the advice they see on TikTok?

TikTok is attractive to many young people because it conveys information in short, digestible audio chunks and can make complicated topics seem less intimidating. The problem is that it can be difficult to identify misinformation and resist trendy stock tips. Many influencers do not always provide unbiased information that is in your best interest – be aware that they have their own interests. Young investors need to do their own due diligence. Examine who you are getting your advice from and verify the information they provide. Personal finances are personal. You need more than quick audio bites to make informed decisions.

That said, you can find some credible sources on social media. For example, Greenlight recently launched an educational video series created for teens, by teens called #NowYouKnow, which covers basic personal finances on YouTube and TikTok. Personal finance books can also be a great resource. I recently published a book called “Gen Z Money $ ense” that provides a comprehensive introduction to the world of personal finance and investing while presenting topics in a fun and accessible way.

Check out: 51 of the biggest influential money on TikTok and YouTube

In addition to investing, what other areas should Gen Z take into account in their financial planning?

It is important to have a comprehensive picture of your finances. Young people should first create a budget to ensure that they live within their means and expenses according to their priorities. Budgeting helps you make informed financial decisions and minimize debt. After budgeting, saving is an important next step that can serve as your foundation for investing.

What are some of the common money mistakes you see other generations Zs make?

One of the most common money mistakes I see other generations of Zs have is misusing credit cards. Many young people spend too much with their credit cards and create excessive debt, which puts them in a financially uncertain situation at an early stage. They then end up paying significantly more for an item than it originally cost.

Another common mistake is to think that you are young and can delay savings and invest in retirement. Time has the biggest impact on your nest egg, and interest rates are a young investor’s best friend. Every dollar you invest today can turn into $ 2, then $ 3, then $ 4 and so on with discipline and patience.

More: 7 moves Gen Z must make to protect himself financially

What is the best financial advice you have ever received?

The best financial advice I have ever received was to open a Roth IRA when I got my first job at the age of 14. A Roth IRA is one of the few investments that lets your money grow over time tax free. I highly recommend that young investors earning income benefit from it.

What is the only money step every Gen Z is going to make right now?

Create systems for your finances. That way, you take emotions, impulses and thinking out of the equation. Automate contributions to your investments, which is a strategy known as average cost in dollars.

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Last updated: September 13, 2021

This article originally appeared on Money advice from a teenager who opened a retirement account as a 14-year-old and wrote a book as a 16-year-old

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