Your Ticket to Ride

If your parents are baby boomers who are fast approaching retirement, chances are they were too stoned to learn the facts of life themselves. But if the current National financial crisis has your attention it is not too late to learn those facts yourself. Herewith a list of useful guidelines to help you sidestep the muck your parents are mired in now:

Rules to Live By in the Grown-up World
• There is no free lunch. Santa Claus, the Easter Bunny, and the Tooth Fairy are make-believe characters for kids. The government is not the adult's version of Santa Claus, unless you happen to be in the government yourself.
• Start thinking about your retirement. Now. If you have finished school and found gainful employment, start paying down your debt and begin saving for your retirement. Time is your friend.
• Stock-picking is not for you. Only Warren Buffet knows how to do it, and he doesn't always guess right either. You don't stand a snow-ball's chance in hell.
• Invest the maximum allowed by the IRS in a tax-deferred, broadly diversified, balanced mutual fund, on a dollar cost-averaged basis, especially if your employer is willing to make matching contributions for you. Deferring taxes until retirement will generally mean you'll be in a lower tax bracket when you pay. Diversification is the best alternative to stock-picking. A balanced fund will automatically buy low and sell high. And dollar cost-averaging will, in the long run, reduce your cost. Matching contributions from your employer is tantamount to an immediate 100% appreciation of your investment, and, to the best of my knowledge, is the only bit of free lunch in the whole free world.
• Purchase insurance for home, car, and health care. Can't afford it? Don't buy the home. Still can't? Don't buy the car. Must have a car? Buy a cheap car. Still can't afford health care? Don't get sick. WTF! I can't solve all your problems. You have to assume personal accountability to make it in the grown-up world.
• That quip about the difference between men and women being "reason and accountability" was funny, but the truth is it's the difference between responsible adults and everybody else. The brain is your friend. Personal accountability is your ticket to ride (clean bill of health).