Extra 10 in Your 20s

Last Friday, my wife and I took our three children down to the college where we met and graduated from.  The kids love to see the lecture halls, pretend they’re a professor and just run around the ghost town campus like they own the place.  While I was looking out into this ocean of lecture hall seats, I thought to myself “if this room was filled with graduating seniors, what advice would I give them…?”  There are plenty of people telling them to follow their passion and so, here is what I came up with: 

Every year after you graduate, only while you are in your 20s, go out and hustle, grind and earn an additional 10% above what your day job pays you.  If you have a job earning $30,000 a year, go out and earn an additional $3,000. The next year, you got a big promotion and jumped up to $40,000 so now you need to earn an additional $4,000.   What you do, how you do it and how much time it takes is completely up to you, but before your life, career and family take off, do a little extra hard work to build a foundation for an uncertain future.  

What should I do with that money you ask?  For today, let’s be super boring and invest it.  After all, this money is not your biweekly paycheck, this is the money you’re out earning because some almost balding financial guy preached to you about it your last year in college.    

Age Extra 10
22 $3,000.00
23 $4,000.00
24 $4,000.00
25 $4,000.00
26 $4,000.00
27 $4,000.00
28 $4,000.00
29 $4,000.00
30 $4,000.00
Total $35,000.00

If this money grows at 8% per year, the $35,000 you saved would be worth approximately $103,342 when you turn 40.  If you kept your hands off of it until you turned 65 it would be worth $711,164!!!  

When I get my opportunity to actually tell a graduating class this, my emphasis would not be on the investing part, but on the doing a little extra work part.  I think it is highly unlikely one would regret those one or two nights per month waiting tables in their 20s when the trip of a lifetime pops up or 10 years later when they’re staring down the barrel of planning their first Disney trip for the family.   Wish me luck so I can hit the podium soon 🙂 

Happy Friday!