What should my finances look like at 18?
Assume you will need to retire with a few million in the bank to maintain an average lifestyle.  I had an analysis done for me (at 33) that shows my family, to keep it up lifestyle will need to have 3.4MM in the bank so in retirement I can draw down enough cash. This number reflects inflation. Now that you are 18, if you make consistent but small savings you will achieve that financial stability.  Try to make it automatic so you aren't tempted to spend. There is more you can do but since you have such an early start, you can do less than most people and still have plenty. Even thought it is great you are thinking about it, don't forget to be young, move around lots and have fun.  Just pay yourself first and have fun second. Also, thank whoever guided you to this point.  If you did it all on your own, be proud. "To buy a house, you need: At least 2 years tax returns (shows a steady income history; even if you're making 50k right now, you probably weren't when you were 16, and you might not be when you're 20; as they say, easy come, easy go). A 20% down payment.  These days, that easily means writing a $50k check.  You make $50k a year, great, but try this math: how long will it take you to save 100% of your annual salary?  If you're saving 15% of your income (which puts you above many Americans), it'll still take 7 years.  So no house for you for 7 years. While your attitude of ""I've got the money, so why not"" is certainly acceptable, the reality is that you don't have a lot of financial experience yet.  There could easily be lean times ahead when you aren't making much (many people since 2008 have gone 18 months or more without any income at all). Save as much money as possible.  Once you get $10k in a liquid savings account, speak to a CPA or an investment advisor at your local bank to set up tax deferred accounts such as an IRA.  And don't wait to start investing; starting now versus waiting until you're 25 could mean a 100% difference in your net worth at any given time (that's not just a random number, either; an additional 7 years compounding time could literally mean another doubling of your worth)." "If you're making big money at 18, you should be saving every penny you can in tax-advantaged retirement accounts. (If your employer offers it, see if you can do a Roth 401(k), as odds are good you'll be in a higher tax bracket at retirement than you are now and you will benefit from the Roth structure. Otherwise, use a regular 401(k). IRAs are also an option, but you can put more money into a 401(k) than you can into an IRA.) If you do this for a decade or two while you're young, you'll be very well set on the road to retirement. Moreover, since you think ""I've got the money, why not?"" this will actually keep the money from you so you can do a better job of avoiding that question. Your next concern will be post-tax money. You're going to be splitting this between three basic sorts of places: just plain spending it, saving/investing it in bank accounts and stock markets, or purchasing some other form of capital which will save you money or provide you with some useful capability that's worth money (e.g. owning a condo/house will help you save on rent - and you don't have to pay income taxes on that savings!) 18 is generally a little young to be setting down and buying a house, though, so you should probably look at saving money for a while instead. Open an account at Vanguard or a similar institution and buy some simple index funds. (The index funds have lower turnover, which is probably better for your unsheltered accounts, and you don't need to spend a bunch of money on mutual fund expense ratios, or spend a lot of time making a second career out of stock-picking). If you save a lot of your money for retirement now, you won't have to save as much later, and will have more income to spend on a house, so it'll all work out. Whatever you do, you shouldn't blow a bunch of money on a really fancy new car. You might consider a pretty-nice slightly-used car, but the first year of car ownership is distressingly close to just throwing your money away, and fancy cars only make it that much worse. You should also try to have some fun and interesting experiences while you're still young. It's okay to spend some money on them. Don't waste money flying first-class or spend tooo much money dining out, but fun/interesting/different experiences will serve you well throughout your life. (By contrast, routine luxury may not be worth it.)" "The golden rule is ""Pay yourself first."" This means that you should have some form of savings plan set up, preferably a monthly automatic withdrawal that comes out the day after your pay is deposited. 10% is a reasonable number to start with. You are in a wonderful situation because you are thinking about this 10-15 years before most of us do.  Use this to your advantage. You are also in a good situation if you can defer the purchase of the house (assuming prices don't rise drastically in the next few years -- which they might.)  If your home situation is acceptable, then sit down with the parents and present a plan.  Something along the lines of:  I'd like to move out and start my   life.  However, it would be   advantageous to stay here for a few   years to build up a down payment and   reserve.  I'm happy to help out with   expenses, but do need a couple years   of rent-free support to get started. Then go into monk mode for one year.  It's doable, and you can save a lot of cash. Then you're on the road to freedom." I was in a similar situation at age 18/19, but not making quite as much money. I maxed out an IRA and bought savings bonds, although rates were decent then. I did flitter away about half of what I earned, which in retrospect was probably dumb. But I had a good time!
You owe $10k at 18% and borrow an additional $10k at 0. When you pay back $10k, they are likely to apply it to the zero rate money and you are out 2%. Your question has merit, but as others say, the devil is I'm the details. You should read the fine print.  My credit card checks forbid drawing a check payable to myself. I need to pay another account, in my case easy to 'pay' my HELOC, then draw the funds. Firstly, playing the lottery is not investing it is gambling. The odds in gambling are always against you and with the house.  Secondly, no one would ever give you a payout of 3 to 1 when the odds are 50:50, unless they were looking to give away money. Even when you place your chips on either red or black on a roulette table your payout if you are correct is 100% (double your money), however the odds of winning are less than 50%, there are 18 reds, 18 blacks and 2 greens (0 and 00). Even if you place your chips on one single number, your payout will be 35:1 but your odds of winning are 1:38. The odds are always with the house. If you want to play the lotto, use some money you don't need and expect to lose, have some fun and enjoy yourself if you get any small winnings. Gambling should be looked at as a source of entertainment not a source of investing. If you take gambling more serious than this then you might have a problem. Not sure if you mean that your SO stands to inherit $18 million or has inherited it already.  I would hope that her family already has a team of financial advisors at that point.   The name of the game at that asset level is protection.  You have enough money so you want to keep up with inflation and generate some income.  Most of my firm's clients at that size have at least 50% in tax-free municipal bonds the other half is about 10% in aggressive investments (private equity, aggressive stock managers), and 25% in conservative stock investments, 5% in international investments, and 10% in alternative investments (long/short, GTAA, hedged equity) .  They also tend to have quite a bit of income producing real estate.   Make sure you meet with a financial advisory firm the specializes in high net worth clients.  I work for an independent RIA so I may be biased towards independent and fee-only firms but it seems like the best arrangement.  You pay a percentage of assets under management and get objective investment advice with no commissions.  For $18 mil anything over .50% as an advisory fee is a ripoff.  You all in investment cost should be less than 0.90%.   Also you should look into a high net worth insurance broker.  You current insurance salesman will be in way over his head.    Feel free to PM me with specific questions.  Also, if you want to hire my firm that would be great haha! I'm not familiar enough with finance in any capacity to know what the difference is between financial services or a finance department (beyond what you said); my familiarity of the industry extends to trading, rating, and financial law enforcement. But at a glance on mobile, that looks like pretty much exactly what I was looking for. I have no connect to the industry, but habe been on a Wall St media binge lately, and like to understand powerful/influencial sectors of society anyways. Thanks. "You should certainly look into investments. If you don't expect to need the money until retirement, then I'd put it in an IRA so you get the tax advantages. It makes sense to keep some money handy ""just in case"", but $23k is a very large amount of money for an emergency fund. Of course much depends on your life situation, but I'm hard pressed to think of an unexpected emergency that would come up that would require $23k. If you're seriously planning to go back to school, then you might want to put the money in a non-retirement fund investment. As I write this -- September 2015 -- the stock market is falling, so if you expect to need the money within the next few months, putting it in the stock market may be a mistake. But long term, the stock market has always gone up, so it will almost certainly recover sooner or later. The question is just when. Investing versus paying off debts is a difficult decision. What is the interest rate on the debt? If it's more than you're likely to make on an investment, then you should pay off the debt first. (My broker recently told me that over the last few decades, the stock market has averaged 7% annual growth, so I'm using that as my working number.) If the interest rate is low, some people still prefer to pay off the debt because the interest is certain while the return on an investment is uncertain, and they're unwilling to take the risk." You have made the most important first step by starting to think about your money, well done. Firstly pay of all credit cards as quickly as you can and start to live within your means.  Until you have paid of your credits cards don’t spend any money of unnecessary items, e.g. Once your credit cards are paid off you can start living a more normal life.  Each time you spend money you need to ask yourself: Is this worth more to be then being   able to buy a new house in a few years   time? You should be able to save at least half the amount you were paying of the credit card each mouth and still leave a reasonable life, so setup a standing order at the start of the month to  your saving account. Given your age you are like to get promoted and hence have increased pay or get increments for each year of service.  Therefore Every time your pay goes up, set up a   standing order to transfer at least   half of the pay increases to a saving   account.   You did not have this money   before, so you will not miss it when    you save it. In the long term, you should be able to keep your car until it is about 15 years old, so will not have the cost of buying another car.  Therefore once the car loan is over, you can save that money as well. "I have an idea.  Keep saving what you are and think ""Early Retirement"".  Work for 20 years, then do whatever you want 40 hours a week.  If your satisfied with your current lifestyle, start thinking of your bigger long term financial goals and when you want to accomplish them by.  Maybe you can accomplish these sooner than you think.  Saving to buy a house/property?  Investment portfolio?  Want to travel all over the world?  Family planning/kids?  I am sure you will figure out how you would want to spend it." The first thing you need to do is to set yourself a budget. Total all your money coming in (from jobs, allowances, etc.) and all your money going out (including rent, utilities, loan repayments, food, other essential and the luxuries).  If your money coming in is more than your money going out, then you are onto a positive start. If on the other hand your money going out is more than the money coming in, then you are at the beginning of big trouble. You will have to do at least one of 2 things, either increase your income or reduce your expenses or both. You will have to go through all your expenses (money going out) and cut back on the luxuries, try to get cheaper alternatives for some of your essential, and get a second job or increase your hours at your current job. The aim is to always have more money coming in than the money you spend. The second thing to do is to pay off any outstanding debts by paying more than the minimum amounts and then have some savings goals. You said you wanted to save for a car - that is one saving goal. Another saving goal could be to set up a 6 month emergency fund (enough money in a separate account to be able to survive at least 6 months in case something happened, such as you lost your job or you suddenly got sick). Next you could look at getting a higher education so you can go out and get higher paying jobs. When you do get a higher paying job, the secret is not to spend all your extra money coming in on luxuries, you should treat yourself but do not go overboard. Increase the amounts you save and learn how to invest so you can get your savings to work harder for you. Building a sound financial future for yourself takes a lot of hard work and discipline, but once you do get started and change the way you do things you will find that it doesn't take long for things to start getting easier. The one thing you do have going for you is time; you are starting early and have time on your side.