Ask HN: How can I use money to make money?

#1

Post by speedylight » Sat, Jun 11, 2022, 11:35 AM UTC

As it stands for me, I work 40 hours a week for $20 an hour… which is more than enough for me to be comfortable and then some. I get that that’s nowhere near the money most people on here make, but I am only 20 years old.

I have the advantage of being extremely flexible, I can make changes in all sorts of ways to optimize for a certain goal… usually it’s only my own discipline (or lack of) that stands in the way.

Lately I’ve learned that I have a taste for an expensive lifestyle and I want to explore that angle a bit more which is why I’ve been looking for ways to use the money I already have to invest and get a return on it.

With time on my side, I don’t mind making investments that won’t see returns until a few years down the line, I just have no clue where to start.

I don’t care about being filthy rich, I want a GTR not a Lamborghini.

Re: Ask HN: How can I use money to make money?

#2

Post by agent008t » Sat, Jun 11, 2022, 1:57 PM UTC

Look up /r/personalfinance, /r/fire, /r/fatfire.

Be aware that it is unreasonable to expect returns higher than ~5.5%/year over inflation — and that is if you're really prepared to lose 50% of the value of your assets and not have them recover for 10-15 years. If you are being offered higher returns, it is very likely you are not fully aware of the risks you are taking on.

Re: Ask HN: How can I use money to make money?

#3

Post by anon2020dot00 » Sat, Jun 11, 2022, 2:18 PM UTC

Fastest way probably is to get a higher paying job.

In terms of investments, the Rule of 72 is that a return of 7 percent a year will double your capital in 10 years. So assuming that S&P 500 will return roughly 7 percent a year, expect your capital to be doubled in 10 years.

Of course there is no guarantee that the S&P 500 will continue it's upward trend it has been on.

Re: Ask HN: How can I use money to make money?

#4

Post by cpach » Sat, Jun 11, 2022, 3:02 PM UTC

agent008t wrote: post #2

Look up /r/personalfinance, /r/fire, /r/fatfire. Be aware that it is unreasonable to expect returns higher than ~5.5%/year over inflation — and that is if you're really prepared to lose 50% of the value of your assets and not have them recover for 10-15 years. If you are being offered higher returns, it is very likely you are not fully aware of the risks you are taking on.

This is good advice. Another useful starting point could be: https://www.bogleheads.org/wiki/Main_Page

Re: Ask HN: How can I use money to make money?

#5

Post by feet » Sat, Jun 11, 2022, 3:19 PM UTC

anon2020dot00 wrote: post #3

Fastest way probably is to get a higher paying job. In terms of investments, the Rule of 72 is that a return of 7 percent a year will double your capital in 10 years. So assuming that S&P 500 will return roughly 7 percent a year, expect your capital to be doubled in 10 years. Of course there is no guarantee that the S&P 500 will continue it's upward trend it has been on.

Oh interesting, so we can purchase our way into better paying jobs now? Where do I sign up and how much does it cost?

Re: Ask HN: How can I use money to make money?

#6

Post by BlameKaneda » Sat, Jun 11, 2022, 3:42 PM UTC

For every bi-monthly pay period, I deposit 12% into my IRA and 4% into my regular investment account. Also, a certain amount is taken from my paycheck and deposited into my 401k.

I've deposited the maximum $6,000 into my IRA for the past two years, and I plan on doing so indefinitely. If it's December and the paycheck withdrawals haven't totaled $6k, then I'll transfer the remainder from my bank. And although I don't deposit as much into my regular investment account, whenever I see fit I'll transfer some of my bank account funds into it.

I wouldn't be able to do this if it were not for money coming in.

Re: Ask HN: How can I use money to make money?

#7

Post by anon2020dot00 » Sat, Jun 11, 2022, 3:46 PM UTC

feet wrote: post #5

anon2020dot00 wrote: post #3

Fastest way probably is to get a higher paying job. In terms of investments, the Rule of 72 is that a return of 7 percent a year will double your capital in 10 years. So assuming that S&P 500 will return roughly 7 percent a year, expect your capital to be doubled in 10 years. Of course there is no guarantee that the S&P 500 will continue it's upward trend it has been on.

Oh interesting, so we can purchase our way into better paying jobs now? Where do I sign up and how much does it cost?

OP wants to have more money; sensible advice is to find and get a higher paying job that pays more than 20 usd.

Where in my comment do I say that better paying jobs can be bought?

Re: Ask HN: How can I use money to make money?

#8

Post by feet » Sat, Jun 11, 2022, 5:26 PM UTC

anon2020dot00 wrote: post #7

feet wrote: post #5

Earlier quoted context omitted.

Oh interesting, so we can purchase our way into better paying jobs now? Where do I sign up and how much does it cost?

OP wants to have more money; sensible advice is to find and get a higher paying job that pays more than 20 usd. Where in my comment do I say that better paying jobs can be bought?

The question posed by OP:

>"How can I use money to make more money?"

Getting a different job isn't making your money work for you. Getting g a different job generally does not cost money unless you're relocating. Maybe getting g a degree or other qualifications Costa money, but finding a new job does not.

Re: Ask HN: How can I use money to make money?

#9

Post by cableshaft » Sat, Jun 11, 2022, 6:15 PM UTC

BlameKaneda wrote: post #6

For every bi-monthly pay period, I deposit 12% into my IRA and 4% into my regular investment account. Also, a certain amount is taken from my paycheck and deposited into my 401k. I've deposited the maximum $6,000 into my IRA for the past two years, and I plan on doing so indefinitely. If it's December and the paycheck withdrawals haven't totaled $6k, then I'll transfer the remainder from my bank. And although I don't…

Didn't realize you could put more into an IRA when you're already maxing out a 401k. I should probably start doing that. Thanks to most of my 20s working for startups and small companies without a 401k, I'm pretty behind on retirement savings goals.

Re: Ask HN: How can I use money to make money?

#10

Post by cableshaft » Sat, Jun 11, 2022, 6:23 PM UTC

Another thing you can invest in besides stocks, is to invest in yourself.

For example, my SO is working hard to get a side business going writing romance novels. To do this, she's spent a few thousand of dollars on seminars and conventions with both a learning and a networking component (which has gotten her into a regular work group of published authors), learning as much as she could about the industry, money on cover artists, copy editors, proofreaders, joining promotional anthologies, buying props and make up and books to show off on her promotional social media videos, not to mention all the time in learning this stuff and writing the books.

It's starting to pay off as she already has quite a few followers and preorders for her first book that will release in a couple months, higher than some other established authors in her group. There's some authors she knows personally that were able to make $200k doing this in their first year, so she may be on a similar trajectory at this point.

And she's still working a full time job as a marketing manager (making almost six figures for that) during all this, which she's hoping by this time next year she can quit and do this full-time (needless to say, I've been the main person keeping our house somewhat in order during all this, she hasn't had the spare energy).

So yeah, that's one way you can "use money to make money".