Are you kidding? lol, let's take this one at a time:

> 1. Max your 401(k) or equivalent employee contribution.

> 2. Buy inexpensive, well-diversified mutual funds such as Vanguard Target 20xx funds.

> 6. Maximize tax-advantaged savings vehicles like Roth, SEP, and 529 accounts.

What if I told you that the people who own BlackRock, Vanguard, State Street, Fidelity, Northern Trust, and Geode -- six companies who own practically all of the S&P 500 -- have decided they will be emptying out every nickel from your pockets in the near future?

Yes, citizen, put all your money into the index funds especially, and just forget about it. Let the Experts in the casino handle it. You both agree: they know exactly what to do with your money, way better than you.

Thanks to the Experts, your retirement (and life) is now dependent on the performance of Quality Companies like the SpaceX pump and dump scheme, plus other dogs like OpenAI when they join the fray. I'm sure you have nothing to worry about.

By the way, the next giant market crash (1929 style) is imminent as the Everything Bubble has found its needle, so enjoy your window seat on the spaceship to Hell. You buys the ticket, you takes the ride.

> 3. Never buy or sell an individual security. The person on the other side of the table knows more than you do about this stuff.

This is the type of nonsense specialists always tell each other. Generalists have long experience having to deal with this strange mindset that it is only possible for a person to understand one narrow category of things, so everything else must be outsourced to Other Competent Specialists In That Field. Sharks in the financial markets are well aware of this mental weakness and love to introduce things like mutual funds, ETFs, index funds, etc to assure the marks their money is being handled by Competent Specialists who really have their best interest at heart.

Here is what better advice looks like: don't buy/sell any securities unless you, personally, know exactly how and why you're going to profit from it. Anything less is gambling. In this time of economic malaise, war, extreme uncertainty, if you haven't spent decades figuring out what's going on, then you shouldn't be touching any securities at all.

Yes, that means most market participants right now are nothing but gamblers, and the casino always wins.

There's a saying in poker: if you haven't figured out who the mark is in the first five minutes, it's you.

> 4. Save 20% of your money.

Finally, some decent advice. But save it for what? That part is left unanswered. And why only 20%? Saved money is always losing value due to being eaten away by inflation, so like a game of hot potato, you need to figure out a plan to deploy it profitably in a time of increasing uncertainty. In a high inflation environment, if you're not growing, you're going broke.

The correct answer at this moment in time (and good advice in general) is, save your money and invest in one or more proven, profitable, Great Depression-proof businesses that pay you a dividend.

> 5. Pay your credit card balance in full every month.

Better advice: stop borrowing money from sharks, live inside your means, and stop being tracked and owned by whoever owns the credit card companies.

[...]

> 9. Promote social insurance programs to help people when things go wrong.

If you follow all of this bad advice, you're going to be the one needing those 'social insurance programs.'

By the way, insurance is a scam.

Hope this helps.

I never personally liked the blanket advice to "Max your 401k." For most, if achievable at all, that would be the most they can invest at all. Even though it is often recommended alongside a proper "emergency fund," that advice leaves little liquidity without major penalties.

> If you can even TRY to do these things it puts you SO far ahead of the average person.

This is basically the advice of this 2016 post (later book):

* https://en.wikipedia.org/wiki/The_Index_Card

The basics are really basic/simple.

The writer of one punch man was on to something

> God I still remember when a friend showed up on his 18th birthday with a pack of cigarettes to show how “mature” he was. I always think about how much that one decision cost him over the years.

The irony of taxing vices. I imagine most of it's paid by people who didn't know better at a young age, and helps encourage the downward spiral of poverty.

And if you say it discourages young people from starting on the addiction, I think we're barking up the wrong tree. Disposable vapes have the highest amount of nicotine they can put in their nicotine salts. Nicotine pouches like zyns sell the most at 6mg and above. Dispensaries and street weed have enough THC that would put a hippie in the 70's in a psychotic break.

God bless that Gen Z doesn't drink or smoke cigarettes. But they vape nicotine and marijuana. Or use pouches / edibles.

If we don't prevent first time users from getting an intense nicotine head high or accustomed to weed 5 to 10 times stronger than what their parents were used to, then I really don't see the point of excise taxes. It should be about preventing first-time use, and giving off-ramps to these potent products.

1.75 is less than the money is losing value from inflation. If that savings is in USD it's quite a bit less than inflation over the past five years.

Look into a 529 college savings plan.

VTSAX, ASAP.

Inflation is usually estimated at 3% + annually over a long enough time horizon. You're losing money.

> I don't really see what AI has to add for the vast majority of the population

What it does best: sound plausible and never tire of a personal (sounding) conversation

An early study (with one of the early versions of ChatGPT) showed that people also come away less convicted about extreme political notions whereas chatting with a human had no or a slight solidifying effect. It's apparently an amazing tool to convince people of reasonable stuff (and probably also unreasonable stuff, if you'd make it, but I guess those proposals didn't pass the ethics committee!). There's loads of Financial cooks out there that'll convince you of golden mountains for anything that gives them a cut, kickback, or straight-out all of your money, so I could even see the reasoning in encouraging people to chat with just about any chatbot about their financial decisions

My main concern is the reliability: while it may be feel-good to say that it can prevent, say, 95% of scams and 80% of bad ideas, any time it fails at its job will actively steer someone towards ruining their life. Effort might be better spent on something that reliably works. So I'm not convinced either way yet, just that I could see how this is more convincing (and thus effective, at least in aggregate) than a napkin with legit useful commandments (at least for the USA; idk if we have such a thing as 402(K) here)

If all you're doing with a bunch of cash over 18 years (!) is holding it in a bank account to collect interest, you're just losing money to inflation. Bank interest is almost nothing. Better to hold stocks, or at the very least bonds if you're extremely risk-averse.

Though this needs to be put in context - maybe you actually intend for the child to be permitted to spend the cash, in which case a bank account makes plenty of sense.

As the OP has "Aussie" in their name I think they'd be referring to the Commonwealth Bank of Australia Dollarmites accounts. They were shutdown recently after a watchdog investigation. It was locking kids into using the bank that would continue into adulthood and schools were getting paid to sign kids up.

https://www.morningstar.com.au/personal-finance/the-lessons-...

"They found that it provided little value for children and the largest outcome was that children were being exposed to ‘sophisticated’ marketing tactics."

The banks might pay 3% interest, whereas even non-volatile conservative investments like cap notes or bonds would pay something like 7%.

Plugging it into a calculator:

1.03 ^ 18 = 1.70

1.07 ^ 18 = 3.37

Example numbers, but you're effectively taking half of the money that your kid would have had on their 18th birthday, and giving it to a banker.

From a return on investment perspective, it is not great.

Bank accounts are convenient and safe, but you pay the price with low interest rates. But if you don't intend to touch that money for 18 years, you don't need the ability to withdraw at any time without losing money that a bank account offers, so why pay the price for it?

However, it has symbolic and educative value, teaches the value of saving, how interest works without going into the complexities of the financial system, and making it clear to your kids that it is their money, even if they can't touch it yet. So it may be a good thing for that reason, when the sums are reasonable.

You should invest in different things depending on your age.

An old person might want to have more of their money in yielding assets. They are withdrawing from the account so the certainty of having predictable value might outweigh the inflation risk.

Savings intended for a young child should be allocated almost entirely into equities. They are not affected by drawdowns since they won't be withdrawing from the account for a decade or two, but inflation is a primary concern.

A bank account is a particularly bad place to put savings intended for a child long-term. A good high yielding account might barely keep pace with inflation, but it's unlikely to grow much in real terms. The average bank account will lose money in real terms in that 10-20 years.

Bank account interest is pretty much always less than inflation. So, money sitting in a bank account for 18 years is just losing value.

Inflation over a long time horizon is about 3%. Especially if it's going to be a decade or more, just put it in an index fund.

Not OP, but I think they are referring to the fact that you can get tax advantaged accounts instead of a standard savings account. Not to mention the interest rate on those accounts is basically a rounding error.

The interest rate is very low.

My checking account isn’t the best out there at 1%. Same with my savings account at 3.4%.

Neither of those is anywhere near inflation. You are effectively losing money by parking it there.

Most checking accounts don’t pay interest at all. I looked up Bank of America's savings account: 0.04%.

You read that right. Effectively zero. And it’s a flat rate. Whether you have $10 or $10 million in there.

Careful just recently two old guys in Chino Hills, California. Brothers 66 and 67 years old were involved in some sort of apartment deal for 20 million dollars which went south.

They were so extremely dissatisfied with something and went to the house of the financial advisor or grifter depending upon your point of view and took it took on him. What is going to start happening with AI data centers?

Leaving money in the bank is not investing. Also, compare interest rate with inflation, you’re probably throwing away money every year. Meanwhile, your bank is actually investing your money and beating inflation. They pay you the interest and keep the rest.

Those accounts should be in something that pays more interest because you give up the liquidity. You pay (in reduced interest rates) for the ability to withdraw at any time. You can instead be completely risk free and make more money* by promising not to need it for another 10, 14 or 18 years.

* However many of those methods involve locking in the interest rate, so you might miss out if banks start paying 10% like they did decades ago.