Caitlin Taylor
The Most Horrific Financial Advice I’ve Ever Heard Caitlin


When I was in remedial math at 16, we had a guest speaker from a local bank talk to us about the magic of compound interest.

It occurred to me later that the teacher wanted to be there about as much as we did. When you aren’t in smart people math, it’s a safe bet that you aren’t too excited about the subject. Shades of “when am I ever going to use this in the real world!?” Another time she invited a cop in to speak to us who ended up spending 45 minutes discussing how much fun it is to taze people. (Cue lifelong mistrust. I mean if that’s the guy they send out as public liaison, imagine the feelings of the rest of them.)

In any case, at least for me, the magic of compound interest became an excellent reason to focus on math.

The banker explained (without a sales pitch at the end, imagine that!) that once you turn 16, you can start a Roth IRA without your parent’s consent. Then he proceeded to show figures of conservative projections if you funded it from only the money from a summer job until you retired, how much cash you’d have.

Money, turning into more money without any effort from me, sounded like a pretty good plan at 16 when my life goals were reading books and figuring out why I wasn’t cool — never did figure out that second part.

After school that day, I drove down to my credit union to open a Roth IRA.

The confusing part came when I didn’t have enough money for the growth to grow beyond the management fees for mutual funds, so they helped me put the cash into a CD at 5% interest at the time.

I was a fortunate kid in that I had too many activities to get into much trouble — or even spend much money. My summer job (cleaning dorms) just landed cash in my bank that I had no use for. I was reminded time and time again that the smart thing to do was to buy myself one thing I wanted with my summer job money and save the rest.

Saving doesn’t actually make you any money. It just makes the bank money.

Of course, nowadays, CDs are mostly junk, with interest rates lower than inflation. (That means you’re losing money, although less money than if you left it in a savings account.)

Fast forward several years to my first big girl job where we had a 401(k) match. My previous post-college job really pushed the 401(k) but didn’t have a match. I told them to kick rocks and kept stuffing money away in my Roth IRA.

I developed a thing where I get incredibly distressed if my bank account goes down — even a little. So even when I had free time and moved to San Diego, where there are lots of ways to spend your money, I didn’t like spending. The only exceptions were gardening supplies and books — books to the point where my friends had a book buying intervention. (I think they didn’t understand the benefits of books.)

After decided it was time to investigate wealth building because my savings account kept growing at lousy interest, I stumbled across Index Funds.

Index funds are similar to mutual funds, but you don’t have some jerk managing it whose probably not outperforming the market and taking a massive cut at the same time.

I shifted my putting aside money to index funds and discovered how much of a pain in the ass it is to move your money from say a credit union to where ever you’ve set up your Roth IRA for your index funds. Seriously, they make it an enormous hassle. If you have the funds, skip the CDs and go straight to higher return strategies.

But then I still had a problem. I wasn’t maxing out my Roth IRA contributions for the year. I was finding ways for this money coming in to disappear (rent in San Diego is enough to make you cry.)

Eventually, I stumbled upon another novel concept: pay yourself first.

Pay yourself as soon as the money hits your account. Before your bills, before your rent, before your book fund. Everything. (Except debt, but that’s a mathematical analysis we aren’t covering here.)

You adjust to however much cash you have hitting your account each month. Maybe that means you buy fewer books or avoid going out to eat for a while until you can negotiate a raise or promotion.

So where’s what happened.

When I started paying into my retirement at the beginning of the month, I adjusted. I bought fewer books (still have like 80-something unread…it might be a problem.) I spent more time at home, reading or playing video games — both super low cost/hour activities.

Instead of going out to eat regularly, I instead went to superb places once or twice a year.

Ads hitting the “have you saved enough for retirement?” pain point now triggers a “yep, I’m good” reaction instead of the guilt of “oh, I should do that.”

When I hear all of the news about how my generation will never retire because social security is pretty screwed, I’m thinking, “I’ll manage.”

Optimal strategy — get your max employer 401(k) match because that’s free money and also max out your IRA or Roth IRA each year.

Now, I’m not a financial planner. There are a ton of things I could be doing better. But I can retire if I make it to 59 ½. It’s a set and forget thing. If the market crashes, I’m not worried about it. I have the time for it to recover, and I know it’s in the best interest of the people who can afford to buy the lobbyists to make sure the market does well — so I let them do the work for me.

In the end, it’s money that I don’t miss. I can still afford to eat delicious things, see the world, and continue to buy an outrageous amount of books. At the same time, I know that my future self will benefit from my actions now.

I make those actions as brainless as possible with auto-contributing to my retirement before paying any of my bills. While every financial situation is different, paying yourself first forces you into a better future financial position.



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