Advice for an 18-year old
Query: I’m gonna turn 18 soon and I would like to know what are the steps that I can take to start generating any type of cash flow(I’m an engineering student) --from interview in Wint Wealth channel.
At 18 years, I was in college and my expenses were funded by my parents. The only challenge was to live within the budget allocated to me in form of pocket money. I could go back and ask for more. And, often I received the extra money.
My kid has just crossed this stage and my advice was to focus on learning. Analyze the trends in the market and see where the next wave of growth is coming from. In my profession of software, cloud and GenAI seems to be the next big thing. Another 3 to 5 years, these two will be peaking in adoption. 5G and 6G opens a plethora of use cases that may find mass adoption.
At the learning stage, one needs to understand and pick the use case of interest. The college curriculum is basic knowledge. One needs to go beyond college and gain knowledge and expertise in the chosen field. With online learning platforms of private companies and the learning platform of software companies, gaining this knowledge is no longer a challenge. In many cases of software companies, this is even provided free to college students.
At this stage, do not worry about savings and cash flow. At 18, one probably has 12 to 13 years invested in education. Distracting oneself to try and earn some side income is like breaking the 13 years of compounding. If the income comes as a by product of the learning, then good. Else focus on increasing one’s skill and expertise.
In my last lecture of semester to MBA students, I always tell my students to look around the class at their classmates. Then, go home take a paper and write down what they know more than their classmates. This is their unique edge.
Whenever there are some earnings, one can invest in mixture of fixed income and stock. These early savings will have a long time to compound. So even if the amount is small, they will eventually add up.
In chapter 15: Baby Steps of my book, I have described one possible approach towards building a long-term corpus.
Kindly note: I am NOT a SEBI registered advisor. Views expressed are based on my personal experience and learnings. They are stated for educational purpose. Kindly take advice of your financial advisor before taking any action with your money or investment.