Money, Investing, Job Offers, and You
Finances as a Developer
Who I am
Steven Petryk
Full-stack developer at Teeps
Not a financial professional
High-level topics
- Cash flow
- Budgeting and prioritization
- Why to invest
- Investment accounts
What is "cash flow"?
- Monthly income minus expenses
- Basic metric of wealth accumulation
- Kept in check using a budget
Thanks Mint ♥
Building a Budget
- Month-to-month slice of cash flow
- Allows for prioritization of expenses
- Essentials
- Essential luxuries
- Investments
- Non-essentials
- Separate expenses and goals
Example budget
Pre-tax Income
$3,000
Rent
$500
Utilities
$120
Automotive
$400
Food
$300
Left over
$680
Fun money
$1,000
Savings Priorities
- Establish a one-month emergency fund
- Pay off high-interest debt
- Increase emergency fund to 3-6 months
- Pay off medium-interest debt
- Short-term goals
Ally Bank currently has the best interest rate.
Ignoring investments, the order should be:
Savings Strategies
- Use Ally
- Open a new account for each goal
- Only save for short-term (<5-year) goals
- Contribute to accounts based on urgency
Investing
- It's not hard
- The only effective way to beat inflation
- Should be done early and often
Funds vs Accounts
- A fund is a collection of financial assets.
- An account is what holds these funds.
I bought $300 of Vanguard Total Stock Market Index Funds and placed them in my Roth IRA account.
Dude. Nobody cares.
Example sentence:
Types of funds
- Domestic stocks
- International stocks
- Bonds
- ... hundreds of riskier things
Types of accounts
- Savings
- Money market
- Certificate of deposit
- IRA
- 401k
- Brokerage
- ... hundreds more
3 important accounts
Roth IRA
401k
Normal brokerage
- "Tax-free"
- Capped annual contribution
- "Tax-advantaged"
- Capped annual contribution
- Employer may match
- Basically no advantage :/
Other limitations apply based on income, marriage status, tax exemptions, etc.
A three-fund portfolio
Domestic stock index funds
International stock index funds
Bond index funds
- High risk
- High return
- High risk
- Unaffected by domestic stock
- Low risk
- Low return
- Unaffected by stock market
Invest your age in % bonds.
Final savings hierarchy
Source: reddit.com/r/personalfinance
Ways to learn more
Personal Finance Subreddit
/r/personalfinance
Bogleheads Wiki
bogleheads.org
Vanguard's "Investing and Retirement" Series
vanguard.com
Thank you for attending :)
Personal Finance
By Steven Petryk
Personal Finance
- 1,288