Personal Finance

You may already have your spending lean and mean. The next step may be to try to find $5.00 – $10.00 across all the areas you spend. Can you drop an item off the grocery list and save $5.00? Combine two trips into one to save fuel? Can you take public transport or walk instead?

The great investor Warren Buffett, when asked about investment strategy, said he would put 10% in bonds and the remaining 90% in an index fund and just leave it there. Markets will move up and down from day to day, from year to year even. But over the long term, they always grow. You don’t have to know a lot to invest in index funds as a college investor, and the fact they are so diversified means they’re relatively low risk. You can also invest in these funds with a small investment.

So what is an index fund? The fund will consist of a group of shares that mirror a specific index. The most common index funds are based on the S&P 500, which are the 500 largest companies on the stock exchange. Over the last 20 years, the S&P 500 has an annualized return of 8.12%. There were good years in there and bad years in there, but the average over time was 8.12%. Compare that to bank interest which is 2.18%

Once you own shares, you will also start to receive dividends. You can have these paid to you or re-invest the profits and receive more shares. Re-investing is a great way to boost your compound interest and increase results.

Index Funds will also usually have very low fees. New investors often undervalue this aspect of investing, but it can have a significant effect over time, with costs eating away at investment returns. Take note of these pointers when investing your money as a student. 

Okay, you understand how much you, ideally, ought to be saving each month. Are you confused about how to implement this plan into your own life, though?

There are lots of creative money saving ideas you can use to reduce expenses and put more in your bank account. Outlined below are the top 20 options we recommend, broken down into the following 3 categories:

If you eat out regularly, you’ll likely find that it’s harder to save money. Fast food and restaurant meals are expensive! Instead of eating out because you don’t have time to cook or are too tired to prepare food at the end of the workday, start meal planning.

Set aside some time on the weekend to chop vegetables and prepare foods in bulk. That way, it’s ready to go in the fridge and you’ll just have to heat it up when dinner time rolls around.

• Created March 14th, 2009
• 129k Members
• Topics: Tax News and Discussion

Why you should follow it: This is a great subreddit for anyone who wants to learn about tax laws or tax planning. And since about everyone under the sun pays taxes, there’s something to be learned here. If you’re trying to lower the amount of money you pay in income taxes, you’ll find this subreddit especially important.

• Created January 1st, 2014
• 3k Members
• Topics: For Students Studying Finance

Why you should follow it: While a user created this subreddit for students in the finance sector, it contains advice that ranges from getting a good credit score to doing well on college finance assignments. This is a great thread to join if you’re currently a finance student or you’re a high schooler with hopes of becoming a finance student.

If you want to improve your financial situation, these top 20 best Reddit personal finance threads are a great place to get your questions answered and to seek inspiration. No matter where you’re currently at in your journey, you can find a group of like-minded individuals to connect with.