If you are in SF, NYC, or another HCOL area. Your biggest expenses are going to be taxes and housing, with transportation likely a distant third. If you can get the big expenses down, you can eat all the avocado toast you want.

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Guest post by csp256

There is only so much you can do to minimize taxes, but here are the two biggest ways:

  • Contribute the maximum to your 401k (there are several ways of accessing it early; don’t worry)
  • Get a high deductible health care plan and contribute the maximum to your HSA. Leave the money in there and pay for medical expenses out of pocket.

You can do more than this, but it requires specific preemptive planning and flexibility… not attractive for most people. Remember to set your witholdings properly at your new job.

Either get roommates or a studio apartment. Roommates can be cheaper, but it is harder. Don’t be one of those people who spends $30k a year on housing. Renting isn’t throwing money away, but that is. I pay $375/month for housing in Sunnyvale, CA. Do this for a year or two and you’ll be swimming in it.

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Hold 2-3 months of expenses in cash, and 3+ months of expenses in $BND. You’ll need to open an account with Vanguard.

Now you need to understand what to do with all the surplus. This is called investing, and how it works is surprisingly boring and simple. If you ignore the rest of what I say, read this in its entirety:

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Then read this article:

And then this book:

Once you’ve done that you have enough information to decide if you want more information or not. Here are some good additional resources I’ve enjoyed:

tl;dr – don’t spend a lot of money, put everything in $VTSAX, and in 10 years you’ll be either a millionaire or a multimillionaire


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