By Ryan Healy — Unless you are a professional athlete or working on Wall Street, an entry-level salary is not very exciting. When you couple this with the fact that the average college student graduates with tens of thousands in student loan and credit card debt and the cost of renting a place in any major city is an absolute rip off, a paycheck does not go very far. If I am paying an arm and a leg just to have a roof over my head and pay back an education that wasn’t exactly optional, how can I possibly save any decent amount of money? Realistically, I can’t. But that is alright.

If I stay in the corporate world, the paychecks will keep coming, I will pay down debt, I will pay my rent and I will spend the majority of the rest on food, entertainment and happy hours. The remainder will go to savings. One thing I will not waste my money on is “stuff.” Nothing bothers me more than seeing people living in houses above their means and driving cars they can’t afford.

I am not foolish enough to believe a paycheck will ever make me rich. The only reason I get excited about a 3% raise is because of what it represents; my hard work. The increase in money is barely noticeable and will disappear into my 3% lifestyle increase. Sure, I could invest that 3% in stocks, mutual funds or better yet an IRA, but what exactly am I saving for?

It’s a forgone conclusion that I will never retire, and anyone my age who believes they will, is mistaken. First of all, by the time I have children to send off to college, the average tuition will probably be around $100,000 a year. If I have “2.5 kids” that is $1 million dollars out of my pocket (or more realistically out of loans). Even if I deprive myself of vacations, entertainment and fun to save throughout my twenties, I can’t possibly save enough money to retire.

I can’t imagine what I would do if I ever did retire. Sure you may be thinking that I’m barely out of college and wouldn’t be saying this if I had been working for 10 or 20 years. But this is exactly why I am so desperate to find meaning and happiness out of work, rather than just a paycheck.

I guess if the end goal is riding off into the sunset and retiring, then you can put up with a boring, well paid job for 30 years (I guess). This is not my end goal. I would rather find fulfillment in a job that gives me flexible hours and is accommodating to my lifestyle.

Of course, if I am lucky enough to make it to my golden years, I will cut back on the amount I work and supplement my smaller income with the earnings from the smart investments I made along the way. But I certainly won’t be moving south to sit around and do nothing for the last ten years of my life.

The way I see it my life will turn out one of two ways.

1. I will get lucky somewhere along the way and strike it rich. I will pay for my kids’ education, I will buy a moderate house and moderate cars and I will make smart investments for the future. I will use the money to make a difference in one way or another. I will be happy.

2. I will find meaningful, fulfilling jobs with decent salaries or start a mildly successful business. My kids will take out loans for their education, I will buy a moderate house and moderate cars and I will continue to work and invest a reasonable amount. I will donate my time rather than my money to make a difference in one way or another. I will be happy.

Before you assume I am a naïve kid, who needs some financial education, keep in mind, I have a degree in accounting and finance and I regularly read financial books, magazines, newspapers and blogs. Despite all of this, I have come to the conclusion that life is too short to spend worrying about how much money is in my bank account. I will not chase a paycheck.

39 replies
  1. Nitant
    Nitant says:

    Very Well put ryan.What i like is that you are able to differentiate between the amount of money you need and the amount of money you want.Its something that very few ppl are willing to accept thinking that money is the solution to ALL their problems.They live for tomm and miss out on today.It never works.Great work in putting down your thoughts.

  2. Rahul
    Rahul says:

    I agree that paychecks are not the priority, but one thing that strikes me a little odd about your statements about the future is that you assume you’ll be sending your kids to college and spending all your money on that.

    If it’s so expensive, don’t you think people will stop sending their kids to college and instead find other ways to accommodate post-high school education? For instance, I live in the Netherlands where university education is by and large paid for by the government. I don’t have a student loan that I have to pay back. I’m free from that burden and able to spend the money I earn on things that matter right now, not things that happened 5 years ago.

    Maybe the US (assuming that’s where you’re from) will adapt to a more social model in the future, when the described situation becomes a real dealbreaker for our generation. Certainly as our generation becomes increasingly influential in the policy-making world I expect to see pretty big changes in that area.

  3. Working Girl
    Working Girl says:

    You ask “what am I saving for?”

    You might get sick. You might need to take time off to care for a parent/child/spouse. You might decide to start a completely different career. You might choose to move to a new country.

    Money comes in super handy for all those eventualities, and more. Reason enough to save!

  4. KV
    KV says:

    Ryan, I couldn’t agree with you more about acquiring stuff. Money is a means to an end, but that end cannot be happiness. Once the basic needs of food, security, and shelter are taken care of, the happiness created by having more money diminishes.

    I read an article in Money magazine that talks about the same thing (http://money.cnn.com/magazines/moneymag/moneymag_archive/2007/04/01/8403587/index.htm?postversion=2007033010). Though money can buy you some experiences, its the experiences that make you happy, not the money.

    Not sure who said this, “No one on their deathbed regrets things that required more money, but ones that required time.”

    We’ve all wondered what it would be like to win the lottery. We have all made lists of things we could buy and things we could do. I would recommend trashing the list of things you could buy, and seriously thinking about the things you could do. You’ll realize that you won’t need million bucks to check off things on the list, but you might need a million seconds.

  5. Caroline Jack
    Caroline Jack says:

    Hi Ryan,
    According to my Dad (who is, of course, the font of all knowledge), the utility of money is the options it gives you. Keeping your options open is, generally, a good thing.

    As for paycheck-chasing, you may be interested in David Graeber’s list of meaning-making activities that neither produce nor consume goods: http://en.wikipedia.org/wiki/List_of_things_which_are_neither_production_nor_consumption

    Caroline,

    Good point, money does keep your options open.  But with limited resources in my early twenties, I would rather have many options (and fun) now than possible options in the future.  At this point, it’s just not possible to have both.

    -Ryan 

  6. Maureen Rogers
    Maureen Rogers says:

    Ryan – You’re on the right track as far as your attitude toward acquisition. When I see people who have gone for the too-fancy house, or the too-fancy car that they really can’t afford, I am just amazed. Good that you have awareness toward the “stuff trap” at the outset of your career. It’s so very easy to get sucked in. I have a decent home, old car, OK furniture – but no debt. Still, sometimes I find myself thinking ‘wouldn’t it be nice to have a more up to date kitchen’ or nicer furniture or a new car. I then ask myself the key question: so how will this improve my life?

    As for retiring: for the most part, the people I’ve known who’ve aged most happily are those that kept active with work – whether paid, volunteer, or creative, they’ve stayed engaged and involved.

  7. peter vajda
    peter vajda says:

    Thank you for your post Ryan. I apprecfiate your candor.

    For many folks, today, the money issue is more about being seen as a "somebody", i.e., the self-defeating notion that self-worth is defined by my net-worth….so having lots of money to buy, have and showcase their “stuff” equates with being “somebody.”

    My experience says that if more folks really delved deeply into the relationship between mental illness (in all its forms and shapes) and the incessant, insidious and self-destructive drive to allow one's net worth to substitute for their self-worth and really understand the resulting disconnect, more folks might explore work and the meaning of work from a differing, healthier, perspective.

    As a business and life coach, I consistently see folks who have "sold out" their lives, their families' lives, their dreams, their passions, and their purpose to chase the dollar in ways thar are slowing killing them (mentally, emotionally, spiritualaly, physically…)and their relationships – all due to their addiction to consumption. Not only is this country enmeshed in a cycle of poverty, it's also enmeshed in it's own destructive cycle of wealth.

    And, BTW, my definition of retirement? Having chosen the wrong profession.

    ********

    Peter,

    I really appreciate the comment, chasing a dollar while ignoring the important things in life is a terrible way to live.  Also, your definition of retirement is dead on.  Why would you ever retire from something you love?

    -Ryan

  8. Heather
    Heather says:

    It’s not uncommon for those of our generations to believe that they will never retire, be it out of necessity or desire. Indeed, there is much about the American philosophy of debt, consumerism, bloated cost of living and broken social security/medicare systems that give us good reason to believe we will have no options for retirement. However, to use this as a rationalization for not at least trying to save towards retirement (or other goals/safety nets) is hubris.

    You may in fact not have the option to not retire. My father was forced into early retirement a full decade before he was ready; he then proceeded to reskill on his own dime and set himself up as a consultant, adopted Dan Pink’s “Free Agent Nation” as his bible and proceeded to do very well for another few years…until the economy tanked and the consulting work dried up. He now resigns himself to being retired, hoping that the stockmarket is kind to him and that no major health catastrophies befall he or my mother.

    Currently we live in an ageist society in which corporations with an eye on quarterly returns make the rational but nearsighted decision to hire younger workers – who are cheaper – over seasoned elders. This may change once the baby boomers have left the workforce and there is a worker shortage, but by then we’ll also be headlong into the “global economy” and there will be billions of Chinese and Indian workers who are far cheaper than you and I to fill the gaps. Besides, you cannot expect to be working at the same capacity at 85 as you do at 25 or 45. Although, thanks to the medical breakthroughs we’ll see over the next several decades, you can expect to live – albeit not productively – to 120.

    My father was the sole breadwinner in my family and made a decent middle class income; we lived modestly and saved carefully and somehow he managed to pay for my undergraduate and graduate education in cash. When I ask him now how he did this and what his saving strategy was, he cannot tell me exactly, except to say that when he was my age he worried as much as I worry now. He was careful, lived within his means, avoided debt and every time he got a salary increase he increased the amount he saved instead of increasing his standard of living. This is what I do as well, and this is what I would recommend to you and anyone else of the post-baby boomer generations.

    Don’t worry yourself into a tailspin of pessimism. Once you hit your career stride you’ll find that your salary increases take bigger leaps of 10-20% versus the current 3% and as long as you aren’t foolish with your money you’ll come out okay.

  9. Marina
    Marina says:

    I’m also a recent grad earning an unimpressive paycheck, and feeling more than a little scared about the future costs of well… everything. But I don’t agree with the conclusion you draw from our situation: saving is pointless anyway, so we should just relax and enjoy our paychecks and happy hours today.

    I’m a software developer, and I like my job, but that doesn’t mean I don’t want to “retire” (ie not have to rely on a job) someday! Lots of people, probably even those who love their careers, look forward to someday switching it up: working for a non-profit, starting their own business, or trying out their own thing in one way or another. I’d like to have the chance to work on my own (or open-source) projects full time, instead of doing what my Corporate Master demands. All of this requires savings!

    I want to take a year, or at least a summer, off work sometime in the next years to travel. To do it, I’ll need money in the bank.

    And that’s ignoring the obvious stuff, like kids and mortgages.

    So no, I definitely don’t chase the dollar, buy any “stuff,” or plan to live in anything more than a moderate house, but I do recognize that money saved gives me options. I know that extra 3% invested won’t make me rich (by a long shot!) but it’ll get me that much closer to being able to work only towards my goals, instead of someone else’s. And that’s worth saving for.

    ********

    Marina,

    You make some excellent points here and I think we are more or less saying the same thing about retirement.  If switching to non profit work or starting a business is considered retirement, then I may be retired by 23.  You do not need a life savings to do these things, although some money does help.  Obviously I do not spend every dime I make, but I refuse to save everything now and miss out on some great life experiences.  You don’t need money to work towards your goals!  Thanks for the great comment.

    -Ryan

  10. Dustin
    Dustin says:

    I am currently paying the loans, for which I had no parental assistance, for my college education at a private school and am finding it manageable. Just a thought.

  11. Wendy
    Wendy says:

    Ryan, I enjoyed this post. Yesterday and today in Canada some very different stories ran in the newspapers about 20-somethings and home buying:

    http://www.canada.com/nationalpost/financialpost/homebuyers/story.html?id=a0606ace-83d8-43ed-be86-0ae67c00c79f&k=7275

    I thought you and others might find it interesting (keep in mind Canada doesn’t have sub-prime mortgages and isn’t experiencing the same housing market worries as in parts of the USA)

    Here are a couple exerpts:
    “Alia Azim purchased her first home three years ago — a condo in the southwest Mission district in Calgary. Then last summer she bought another condo in South Calgary, renovated it and sold it. In September, she bought a house in the southwest Parkhill neighbourhood. She still owns her first condo which she now rents out.

    “It was scary when I had all three at the same time,” laughed the 29-year-old Azim, who works in labour relations.


    “”I’ve talked to a lot of my peers who share a value with me and that is they’d rather spend the money that they earn in an investment of some kind rather than on a lavish honeymoon for example. Or a huge wedding.

    “It’s the same age that you do all those things . . . I’d rather spend my money right now on investments that will pay off in the future. I think they also share the value of developing multiple streams of income.”

  12. Lewis Green
    Lewis Green says:

    Don’t feel badly Ryan. The same was true for my generation, the Baby Boomers. And for my Dad’s generation, the Greatest Generation. Pay checks never mean a retirement blessed with plenty. Unless we are willing to reduce our lifestyle standards, retirement isn’t an option for those unwilling to climb corporate ladders or create booming businesses.

    I am 60 years old, worked in the corporate world, and am now on my third entrepreneurial business. First, as my own boss, why would I want to retire? I like my boss and he likes me. And, second, I stopped working for others long ago because retirement wasn’t that attractive based on what I could save and what my Social Security check will deliver and for my lack of desire to rise above the level of Manager.

    You’re young. Enjoy the adventure and don’t sweat retirement. If you really want to retire, you can climb the corporate ladder, invest wisely, and max out your 401K. As for me, the ladder went unused, and I spent my youth earning enough money to travel and do my own thing. The numbers just didn’t crunch right for me to plan for retirement. For me, the decision was a good one.

    ********

    Lewis,

    Thanks for the advice.  I love reading comments like this, they always motivate me.

    -Ryan

  13. Jason
    Jason says:

    Ryan, there are some aspects of this post that I have to take issue with. I agree with your suggestion that there is far more to your work life than collecting a paycheck, but I think some of your arguments lack some validity and evidence:

    "It's a foregone conclusion that I will never retire, and anyone my age who believes they will, is mistaken"

    What's your foundation for this argument? You're essentially saying here that (a) nobody your age will make enough money to save for retirement, (b) nobody your age will collect a pension, and (c) Anybody who does make enough money to theoretically save enough money for retirement will spend it on something else, and possibly (d) Social Security won't be around. I think that's an unreasonably large set of assumptions.

    " – by the time I have children to send off to college, the average tuition will probably be around $100,000 for a year."

    I hope you're wrong about this. Have you read this figure somewhere, or is this a guess? I imagine 40 years ago it was impossible to imagine top private schools costing $40,000 per year, so maybe your expectations are realistic. However, there are always other options. Your children could go to community college for 2 years and transfer to a state school for the last two and spend a fraction of that cost. They could earn a scholarship. They could join the military or start a business. Assuming a million dollars in school costs seems a little extreme and/or lazy (not to get personal). There are ALWAYS other options.

    And this is a personal preference, but I find the overall tone of your post somewhat disturbing. You seem to have a sort of hopeless view or attitude towards your financial future, which is probably a hindrance to your own future (and possibly disheartening to some that read this). Every successful person I know will embrace that challenge without getting dissuaded from saving for retirement or accepting that they won't be able to send their college. The whole "believe it and you can achieve it" mentality is a little hokey and used too much, but a good attitude goes a long way in becoming a success.

    Ryan, there are a million possible ways your life could turn out, and you've listed two of them. You're obviously an intelligent and motivated guy, but I wish you had a more positive attitude about what lies ahead.

    ********

    Jason,

    You are right, I am making some extreme assumptions when talking about retirement.  But as I watch my parents and their peers struggle with whether or not retirement is realistic today, I cant help but think it will be a dead subject in 50 years.

    I am far from a pessimistic person, in fact I am very optimistic about my financial future.  I am optimistic because I believe in my abilities and I will find a way to succeed financially.  That being said, I am extremely pessimistic about paychecks ever making me wealthy.  My future is bright because I will succeed and be happy, not because a company will make me rich. 

    -Ryan

  14. Latoya
    Latoya says:

    Hey Fellow TwentySomething!

    Your post is pessimistic, but I completely feel you on this issue. The world we live in now turns the established model for success on its head. The receipe isn’t so easy to follow anymore.

    One of the things that drives me crazy is the financial columnists who talk to the youth. Yes, it is all good and sage advice…that most of us willfully ignore. It is hard to invest in savings and money when you are attempting to live a life. And yes, we know that the money spent on happy hours is better saved and invested…but what if you don’t make it to 30? I feel like banking experiences more than banking cash. As long as I can think and breathe, I can probably find a way to make money – but can I remake missed experiences?

    Being happy is the ultimate goal. And it isn’t always money that gets you there.

    ********

    Hi Latoya,

    I completely agreee that happiness is the ultimate goal and you can never make up for missed experiences! Thanks for the comment.

    -Ryan

  15. Greg
    Greg says:

    Working only for retirement is an empty goal. A parent who has that goal should not be surprised when their child turns out to be a pothead slacker living in the basement at forty (they beat Mom and Dad to retirement!).

    However, there is a point to forgoing happy hours and other life-building experiences in favor of scrimping and saving. While working in IT, I was laid off at the nadir of the dot-com bust. My wife had already left her position in anticipation of starting a family. We took a 70% reduction in income, with a kid on the way. We did not have to sell our house or do anything else desperate; in fact, our lifestyle changed little. Oh, I did go back to school and start work on a Masters. However, had we not made lifestyle decisions on how our money was spent, things would have been much different.

  16. Matt M
    Matt M says:

    Ryan,

    I am also a twenty something (26) and an accountant, I understand your dissatisfaction with your paycheck and your pessimism toward the future however I think you made some points that I take issue with.

    First, you should definitely save a few months salary for things like medical or car or housing emergencies. Like you, I thought I was immune to accidents or unforseen events. However, during a period of time right after I graduated college I was involved in 4 car accidents in a 14 month period none of which were my fault. 2 of them were major and required tremendous costs after insurance etc. Approx. 30% of americans who declare bankruptcy do so because of unforeseen medical costs, disability, etc.

    Second, with debt there are clearly better debt and much worse debt. Mortgage debt is better debt because the interest is tax deductible and your house is an investment that hopefully will appreciate and you can turn a profit on when you sell it. Bad debt is basically most other debt because you are in effect borrowing to pay for things which you can’t turn around and make a profit on and you can’t deduct the interest.

    Third, in most fields the best way to increase your salary is to change jobs or get promoted. You can usually realize large (ie 10%-30%) increases by changing jobs or moving up. I think Penelope may have made this point in her blog. I got promoted to supervisor in my old job after 1 year and received a 14% raise (however I worked harder than I ever had in my life and made huge sacrifices for work). I left that job a couple years later for a lateral change to the same job title at a different company and then received a 15% increase. However, I do feel your pain about not being able to save because I have a house, my wife works too and we have a baby it can still difficult be to afford what we though we should be able to afford for the amount of money we make.

    Your article comes off as very pessimistic at times and almost sounds like the writings of a soldier about to go away to war who feels there is good chance he will die.

    Good post though about the thoughts of a twentysomething.
    -Matt

    ******** 

    Matt,

    Wow, I hope I didn’t come across as a soldier about to go to war.  You make some excellent points about getting larger pay increases as you move up and across companies.  However, I notice that when large raises happen, large lifestyle increases tend to ocurr.  Someone gets a $20,000 raise and they finance a $40,000 car.  All of a sudden you are still living pay check to pay check, but with more “stuff.”  I don’t want to fall into this trap, and this is why raises don’t really excite me.

    By the way, I do save a few months salary, I may have a slightly different view about money, but I am aware that emergencies do happen.  Thanks for the comment.

    -Ryan

  17. Tyson
    Tyson says:

    I’ve been reading through some of the comments on this post (which I really enjoyed) and to me, it seems like the people who viewed it to have negative connotations probably worry about money a little too much.

    If “being rich” is your only dream, that is one thing, but it seems like Ryan has his eye on something bigger, like experiencing enjoyment and meaning in his life before he wrinkles up and gets stuck in a condo somewhere nagging his wife about his ulcer.

    Jason…you’re spending too much time thinking about the logistics and less on the main point. Ryan has a pretty optimistic view of his life; he’ll make it big, he’ll be happy, or he doesn’t make it big, and he’ll be happy…what’s so negative about that?

  18. oldguy
    oldguy says:

    You know what, Ryan – you will look back at this post in ten years and say to yourself, “That was ok then, but things have changed.”

    Here’s what is going to happen in those ten years:

    1) You will realize that working and not working, and in what kind of job you work, may not always be your option. The corporate paychecks may not just keep coming, even if you want them to. Sometime in the next ten years, there will be some kind of recession – hopefully mild – and you will see peers, mentors, friends, and rivals get the pink slip for reasons having nothing to do with how well they did their job. You will realize that so long as you are collecting a paycheck from someone else, life will not be under your control, but you will also realize that if you really want to own your own business, you are going to need some savings for start up money.

    2) You will realize that happy hours are overrated. You also will realize that, the older you get, the less fun they are. It’s one thing to down a few with other kids just out of school. It’s quite another to hang in bars with the thirty somethings – marriage, focus on work, etc., all pull people away from the happy hour, and the 30 and (god forbid) 40 somethings at the bar just gets less and less appealing. I would rather put my money in an envelope and mail it to a total stranger than spend it at a happy hour with a bunch of recently divorced 40 somethings; your mileage may vary, but I bet not.

    3) You are going to acquire responsibilities to others that you now don’t have, and recognize that you already have major responsibilities you haven’t taken into account. You mention college education for your kids, but you don’t mention paying for care for your parents. Chat up the boomers in your office – you will find that for many of them the time and money spent parent care is as great as that spent on their children. The typical boomer alive today (the parents for your generation) will live well into their 80s, and most of them have saved way too little to support themselves in retirement. Obligations, and especially obligations that involve the people you love most in the world, and that you probably are going to love more than any possible job, can affect your perspective.

    While I think it will all look different to you in ten years, I don’t quarrel with your viewpoint for where you are today.

    Remember this while it applies: you are only young once. While youth is generally wasted on the young, go ahead and be the exception that takes full advantage of it.

  19. peter vajda
    peter vajda says:

    In response to Matt’s post, Ryan responded, “Someone gets a $20,000 raise and they finance a $40,000 car. All of a sudden you are still living pay check to pay check, but with more "stuff." I don't want to fall into this trap, and this is why raises don't really excite me.”

    I feel this is an important point. The way I phrase it, for many folks today: “Your expenses always rise to meet your income.” This is part of the unhealthy cycle of wealth for many.

    An attorney I coached a few years back lamented how he couldn’t afford to live on +/- 1 million dollars a year. I asked, “If you can’t afford to live on a million dollars a year, what makes you think you can afford to live on 2 million a year?” His raison d’etre was having “stuff”…and “the “best stuff!”

    Was a difficult and not-very-happy process for him to re-evaluate his values, and, when he had done so, experienced a new and surprising emotional and psychological relationship with money that changed his life, and his sense of self-worth (free of co-dependence on “stuff”).

    As an aside, I don’t know if any folks here ever watch Suze Orman’s Sat night finance show on TV, esp. the segment, “Can I afford it?” It’s curious to hear folks wanting to buy stuff…folks who have little take-home pay, little to no savings, have enormous credit card debt, mortages…and still want the $4K ring, the $65K car, the 8K handbag, the $1200 guitar, the $165 pair of sneakers, and, even more curious, need to ask someone else if they can afford it…..many appear to have no inner sense of reality, or self-responsibility around money at all.

  20. Brent
    Brent says:

    Very mature and insightful comments, Ryan. I am a thirty-something who has learned over time that no amount of money will ever be enough. Therefore, I will not make that the focus of my life and career. (Though there is a calming effect of having a couple months salary in savings for when Murphy comes calling.) Compensation for work is so much more than financial. We must consider the emotional, mental, physical, and spiritual aspects as well. Finally, for those that are “looking forward to retirement”…too bad they didn’t “look forward to every day” instead.

  21. Steve
    Steve says:

    Ryan,
    I whole heartedly disagree with your post. You do not have to be some overachieving, 100 hour per week working, live in the future person to have a life and a potential retirement.

    I started my first job out of school (a year and a half after graduating) at age 23 at $24k/year. I am now mid 30’s and have since worked my way up the ladder to a leadership position (without direct reports). I make what I consider a good salary and feel as though I’m well on my way to saving what I will need for retirement. My family can get by on my salary without my wife working. We live in a nice house in a nice neighborhood with a 5 minute commute to work. My job is flexible, the benefits are great, and while it can be extremely frustrating sometimes, I still have no problem coming to work every day to do what I enjoy.

    I do not work more than 45 hrs/wk unless it is absolutely necessary and spend a lot of time with my family. I’ve lived in several states and in different places with different ways of life. I have been to several countries in Europe, Central America, Australia, China, and all over the US on vacations and trips (business and pleasure). Hint: Always take advantage of business trips, no matter what. Always take a few days to a few weeks before/after the business portion.

    Also, I can honestly say the I have made some COSTLY mistakes in investing along the way. I could be a lot further ahead, but good education always comes at a price. And the fact that you have debt is good. It means your parents didn’t let you skate with a free ride, which would be an indicator of future lackluster performance if they did, in my opinion.

    All of that said, you SHOULD enjoy your 20’s. But, you should also take advantage of compounding interest and free money. You should be contributing at least the company match to your 401k (if there is one). You CAN live at your means, still save and still have fun. I know, I sound like Suze Orman.

    I hope that you take this to heart, know that all is not lost because you aren’t making 6 figures out of college. Just know that I do not want to be supporting your generation (through public welfare programs) like I’ll have to support my parents’ generation by paying Social Security that I may never see a return on. Your salary will do a lot better than rise linearly over the next 10 years (maybe after 40 and once you have kids, it might go linear…). You’ll have more than enough soon enough. You need to be patient. And yes, we all live at our means. That’s why it’s important to make yourself and your future a priority.

    So, like us Gen X’ers, pull your weight, save what you can, and it will all work out. You’ll still have money left over for a couple beers after work and some good experiences along the way.

  22. Mike Berry
    Mike Berry says:

    Call me cranky, Ryan, but I have a real a problem with the following:

    “The way I see it my life will turn out one of two ways.1. I will get lucky somewhere along the way and strike it rich. I will pay for my kids education, I will buy a moderate house and moderate cars and I will make smart investments for the future. I will use the money to make a difference in one way or another. I will be happy.

    2. I will find meaningful, fulfilling jobs with decent salaries or start a mildly successful business. My kids will take out loans for their education, I will buy a moderate house and moderate cars and I will continue to work and invest a reasonable amount. I will donate my time rather than my money to make a difference in one way or another. I will be happy.”

    Sorry, but those aren’t the only two options. You have no idea what’s going to happen to you in the coming years. Nor to your spouse/partner. Nor to your children.

    I agree that young people should pursue their dreams and carpe that diem while they can, as long as they try to live within their means. But it strikes me as a little smug to assume that nothing bad can ever happen to you or the ones you love and that you won’t regret any financial decisions you make now, even with that degree in accounting.

  23. Dave
    Dave says:

    Life will change you. Don’t assume so much about what’s going to happen. I get that you don’t want to chase a paycheck, but you will find there is a huge area between subsistence and affluenza.

  24. Susan
    Susan says:

    Unforunately, the retirement outlook for women is even bleaker because we generally earn less money throughout our careers and then outlive our male counterparts.

  25. scarlettholly
    scarlettholly says:

    I have to agree with Mike Berry is having a certain level of discomfort in there only being two outcomes in the world of work. I also disagree with finding “meaningful work with a decent paycheck”. I suppose it depends on your definition of “meaninful”, but all too often, it doesn’t go in hand with a decent paycheck. And by decent I mean one that will cover medical bills, a bit of a safety net for the time your floor caves in due the washing machine leaking, your kids to go to college. Although chasing money is not a good thing, remember that money can buy you time and experience. Yes, people might not be able to take stuff with them, but I will always remember standing a base camp everest, I’ll always remember boating down the mekong river, and I’ll never forget the beauty of the glaciers in Patagonia; none of those things would have been possible if I hadn’t done some slaving to get where I wanted.

  26. ned
    ned says:

    Ryan-
    Excellent post! Brother, if I’d had your worldly insight ten years ago when I graduated from college I’d be a far more fulfilled (and less stressed) working stiff.

    At this very moment, Im in the middle of yet another reluctant job search (Im sure SOMEONE thinks mergers are really cool, but I’ve not yet reached that conclusion), and I find myself really questioning the wisdom of continuing in this career field (pharmaceuticals). But with two youngsters and a mortgage to contend with, searching for a new and fulfilling career will likely have to yield to the cold calculus of my checkbook, at least for now.

    Congratulations on learning, at such a young age, that the myopic worldview of the Boomers was nothing more than a one-way ticket to an early grave!

  27. Richard
    Richard says:

    If you think Twentysomething paychecks are bad wait until the Thirtysomething checks kick in. Those really sting. They will be larger but so does the responsibility thus robbing you of free time to enjoy it. With Thirtysomething paychecks comes the expectation you are staying at one job or career for a while. After all you'll need to support the family, mortgage, insurance, groceries, car payments, medical payments and all the other fiscal life costs.

    I commend you on not chasing a paycheck. I think a lot of people start out that way. I hope your life will enable you to keep this philosophy. Unfortunately, with most people, life happens and priorities change. If you are in your twenties then my advice is to avoid the corporate world all together. Start your own business but make it a WIDELY successful business not a – €˜mildly' successful one. Mildly businesses usually don't stay around too long. Skip the corporate world. It is very easy to get on a slippery slope with corporate jobs. Once in, you'll look up and realize a decade of your life has gone by and you are chained to your cube with golden handcuffs.

  28. martha
    martha says:

    Maybe I’m too old to comment on this but, I’ve had all kinds of jobs and also have started my own business…I was a little taken back by your comment

    “But this is exactly why I am so desperate to find meaning and happiness out of work, rather than just a paycheck.”

    You will NOT find meaning and happiness out of work. You will CREATE meaning and happiness in your work if you choose to do so. You can do that with any job if you put your mind to it.

  29. Bryan Hancock
    Bryan Hancock says:

    I think the tone of your post is a bit negative Ryan, but I can understand where you are coming from. I started my career during the dot com bust in '02 and some really smart people (EEs with 3.85+ GPAs from a top ten school) were competing for positions with people 10 years their senior and having difficulty finding ANY work. Things are much better now and you can find what you want in the corporate world before you venture out on your own.

    Everyone knows this is the way to achieve true happiness, but few ever do it because they are too scared, lack confidence in themselves, or both. After finishing my MBA I knew that I wanted to start my own small company. Engineering and the corporate world suck the life out of you and the best you can hope for is a mild increase in your standard of living in exchange for the bulk of your working career. Trading time for money won't ever get you very far regardless of the exchange rate. What you need to do is learn to leverage other peoples' resources to make your income growth exponential instead of linear. Explore ways to grow passive residual income instead of active linear income and you will do fine. Learning to be financially independent is no different than learning any other life skill. Devote a large portion of your time to doing this and you will quickly see how your dreams are more attainable than you currently think they are.

    Best of luck,

    Bryan

  30. Jeff
    Jeff says:

    Hi, I’m 25 with No college education. I’ve been chasing a Paycheck since I was 18. I work 9-11 months out of the year, working 70-80 hours all year.
    I myself got stuck in the trap. Bought a House (Which I now rent out) and a 36 thousand dollar truck, to Pull a 16 thousand dollar 5th wheel that I live in, Still all my bills will be paid off before I’m 34 if I keep this job.. Which i Will.
    I’m pretty happy though. I work on the road and I make about 2500/week. I Enjoy the lifestyle, I never traveled as a Child, Now I’ve been in 49 states. Sure, my social life is way below par for a 25 yr old, but I’m kind of socially awkward anyway. Not a huge fan of kids either.

    I have the option to retire in the future. Money is out there you just have to go after it, educated or not. Networking and knowing how to talk to people is more important.

    What I’m trying to say, This works great for me. If your happy living within your means, go for it! No one is trying to tell you how to live your life. Family and Friends try, but in the end its up to you. My sister hates my line of work. she thinks it would suck moving all the time. She’s happy with her 2 kids and Husband. He’s a factory worker, and she works at a bank, They are Happy.
    I Do my thing, I am happy, I enjoy it.

    Making a good living isn’t hard if your not afraid of Hard Work and Travel..

  31. Patrick De Amorim
    Patrick De Amorim says:

    This is a very interesting article and i am quite sure it will be quite eye opening for some people.

    but i just want to mention this, please correct me if i am wrong, but that 3% raise which you got, it would be nice and you could invest 3% more into any sort of investment you prefer, but you forgot to mention inflation rate. If the value of your dollar drops by 2% that year you get a 3% raise, you can really only use 1% extra on anything you want.

    Even worst, which seems to happen quite often is the inflation rate may increase by 1, 2, 3 percent, etc. but your salary stays the same, therefore reducing the purchasing power of your paycheck.

    Patrick De Amorim
    http://patrickdeamorim.com/

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