I keep checking my mailbox to get an invitation to speak at a school graduation, but alas, the invitation never came.  Therefore, I’m going to share some financial advice I wish I had when I graduated (high school and college).

1. When given the choice to learn from your own mistakes or the mistakes of others always choose the mistakes of others.

You are a generation that has access to more information than any previous generation.  On the right is the internet, on the left the libraries and straight ahead there is quality education.  Not only is there more information, but technology is opening the door for faster and more efficient ways to access that information.

But, history is useless unless we learn the lessons history so desperately wants to teach us.

Look.  You could make your own mistakes, but that doesn’t make any sense does it?

Read a top personal finance book.  Subscribe to some personal finance blogs (like SeedTime).  Talk to your grandpa.  Learn from those who have already made the mistakes.

2. Remember that the mirror is your greatest investment indicator and financial advisor.

There are more investment indicators than I care to know about.  They gauge when the market is overpriced and when the market is a value.  They predict when you should buy and when you should sell.

There is a season for everything. Just because the market is down does not mean it is a good time for you to buy stock.

Just because house prices are at a national low does not mean it is a good time for you to buy a house.

Follow a plan to develop a lifestyle of generous giving, then get out of debt, fully fund an emergency fund, and then invest or buy a house.  Purchase things based on when you are ready, not the market.

3. Choose life over money.

Money is not king of the financial jungle.  To make every decision simply because it is the best mathematical decision is a mistake.  You will feel caged in and you will lack the passion for life.  God wants us to live life to the fullest.  Life is his gift and how we live our lives is an act of stewardship.

I’ve never made much money in my life – though God is continually blessing me with more income. But as much as possible, my wife and I have chosen to do what we were passionate about, not what paid the bills.  Interestingly, we’ve always been able to pay the bills.

4. If you think only about today, your future self is going to have a fit.

No one knows the sum of their days.  However, if God grants you another 10-15 years and if you act the financial fool, then your future self is going to have some nasty things to say.

Every day you overspend is two days you’ll make your future self miserable.  That is the unfortunate reality of paying someone else interest.  You will slide further and further in debt.

However, there is another side to the coin.  For every day that you spend less than you earn is two days in the future you don’t need to work.  You will gain more and more financial freedom.

The best way to be responsible today is by making a budget and controlling your spending. Don’t go ignoring your future self.

5. Generous giving is one of the most satisfying things you can do with money.

I’ve done a lot of things with money. I’ve spent it on debt repayment.  That is a horrible feeling.  Knowing that someone else is profiting just because they lent you money.

I’ve spent money on the daily ‘necessities’ of life.  However, that satisfaction of stuff never lasts.  The MP3 player I was so excited about buying broke.  My first laptop required a crane to carry, but now there is the iPad.  What is new will become old.

I’ve spent money on experiences and memories.  Now we’re moving in the right direction.  When I think back over my life those memories grow stronger and more fond.  They still add something of value to my life.

I’ve spent money on helping other people.  One of the first decisions my wife and I made after we go married was to send some money to some missionaries in Japan.  Still today I think about that decision and it warms my heart.  Is there a Christian in Japan today because I sent that money?  That feeling is amazing.  Being part of God’s plan is extremely satisfying.

I once gave money to a family so their son could have surgery to fix a cleft pallet.  I wonder who smiles more today – me or the boy? That must be why the Bible talks so much about giving.

6. Your net worth is not the total of your worth.

Life is going to tell you some lies – many of them.  Here’s one.  Your net worth is the sum of everything you own.  This is the total value of your life.

Here’s how to calculate your true net worth.

Take all your money and your possessions and subtract everything you owe money for.  Then divide that number by 1,000.

Add up the number of people you have helped, encouraged, taught, ministered to, and impacted then multiply that number by 50,000.

You worth is determined by your obedience to God and your service to man.  People won’t gauck over your bank statement when you die, but they will shed tears if you touched their lives and honored God.

7. Don’t listen to just one source – verify.

Everyone has an opinion, but not everyone is right.  Hey, I even disagree with things I’ve said in the past.

People will freely want to offer you advice.  That’s fine.  But, you cannot freely accept it.  Treat every piece of financial advice as wrong until proven right.

When you turn off your brain and start blindly following, you’re going to make your future self mad.

8. Never underestimate the risk factor.

I continually struggle with this.  I tend to ignore risk.  I tend to think I am the exception to the rule.  Yet, day by day, I must continue to factor risk into my decisions.

Would you rather have $40,000 per year and little risk or $75,000 with the potential of losing everything on one single transaction?  Sometimes our natural selves can be deceptive and ambition is simply a fancy title for greed.

Just remember the tortoise still beats the hare.

9. Debt brings devastating destruction.

Getting things by getting debt is a terrible plan.  Avoid debt as if it was a two-headed monster.  In your life you will likely take on some debt – most people do, but always proceed in prayer and with caution.

Here is some debt you should always avoid – credit card debt and borrowing to invest. Here is some debt you should try to avoid – car debt (see how much you can save by paying cash for a car).

Here are a couple of pieces debt that are manageable in moderation– student loan and house. If you do take on debt make an effort to repay it as soon as possible.

10. Pray for your financial purpose because God has something he wants you to do with His money.

You probably won’t wake up tomorrow and know exactly what God wants you to do with his money, but eventually, your financial purpose will be clear.  Talk to trusted advisors and pray constantly and God will show you how he wants you to use his money.

To have money without purpose is a dangerous thing.

What money tips do you have for graduates?

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