Is 25 hours a week at 7.00 an hour decent?

The best thing you can learn at this time in your life is to make more money and you do this by not wasting it on frivolous things that you can do without.

$7 per hour is a good amount to start with at your age. However, the main thing to think about with your first job isn't the pay wage.

Here are some other things to keep in mind:

1. Do your job well. A good reference is a necessity, but a great reference is an open door to a lot more opportunities. If a future employer is going to give you more responsibility than your current one, he or she is going to ask to see proof that you handled the simple things well, before he or she will hand you more. But with more responsibility comes more pay.

2. Invest in your hidden work ethics. It isn't just the work that you do; it is the thought process behind it that matters too. If you are employed in a public place, keep in mind that potential employers may be watching you.

3. Learn early the importance of investing. If your employer offers savings account drafts into a bank or credit union, take advantage of it by asking your boss to deposit 10% of your check in one of these interest bearing accounts. When it gets to be enough to obtain a certificate of deposit, then do it at the highest local rate. Treat these funds as untouchable. Consider having a co-signer on the account so you cannot go and make a quick withdrawal without having a valid reason. If there is no direct deposit plan at work, then set it aside yourself, every week. The interest is great, but more importantly, the habit will be established in which you will be able to retire very rich. Keep in mind the rules of 72 and 76.

The rule of 72: In credit card debt, or any interest bearing credit debt, for that matter, there is a simple equation to find out how long it will take for your purchase cost to double, if you only make the minimum payment: 72 divided by the interest rate equals the number of years for a $500 guitar to cost, at the end, $1000. There is no worse thing to do than to ask for inflation when you don't need it. Who needs inflation?

Citibank manages a lot of gas station credit cards. They love it when people choose to pay $4.00 for a gallon of gas, by maxing out their gas cards and then just making minimum payments, like, forever.

Here is an example equation that proves it:

$3.25 for a gallon of gas, but who buys one gallon?

Let's say that the first purchase is 20 gallons for a total purchase of roughly $67.

After the card is maxed, and the minimum payment is the only amount being paid, and the interest rate of what is usually 21% is applied, then it takes just a little bit more than 3 years for the cost to double to $6.50 per gallon. And how dumb is that? But guess what? If you miss one payment and are more than 30 days past due, the interest rate jumps to, on average, 29%. In that same time period of 3 years, at that interest rate, if the card is still not current, or paid off to the satisfaction of the bank, or if the penalties applied put the borrower over his or her credit line, then the cost of that long gone gallon of gas has doubled in only 2 years and 6 months.

But how much has the borrower really lost?

If all of the money paid in interest to any bank had been deposited in a savings account, as described below, then not only is the interest paid to the bank, but the potential interest that could have been earned in savings is gone as well.

Ask a close relative that you feel comfortable with how much they paid on credit card, car, boat, and loan interest in 2007. Don't be surprised if they don't even know yet. But if they tell you that it is in the thousands, that would be about average, I think. Now picture yourself several years down the road. Ask yourself if you would rather be paying out those thousands, or doing the next step below with those same funds.

The rule of 76 applies to savings and other types of deposit accounts, and it works the same way, except the money is coming to YOU, not to the bank. For example:

Your current wage: $165 times 10% is $16.50.
Your weekly deposit of $16.50 times 26 weeks equals $429
Every three or four months you will have a fifth payday. Treat it like a bonus, and on that day, set aside the $71 (minus interest accrued by earlier deposits) and you will have the $500 to obtain a CD (not a musical one!)

If the CD is, let's say, 9% interest, and you leave that $500 alone and continue to renew it, then in just about 8 years and six months, it will become $1000. That is the result of the rule of 76. You don't even have to add a single penny, because the rest comes from the bank that is using your money to lend to others. And they earn a lot of money by doing so. (Rule of 72)

Now, if you follow the first few bits of advice that I started with, and that higher paying job comes, or your career blossoms and you are making $14 per hour, and working full time, and you continue the habit, you do the math and see what you will have after 25 years.

Follow your dreams, but don't let snazzy to good to be true things get in your way. There are a lot of ways to expand your horizons, and the best way to do it is with the ones you know up close and personal.

Always feel free to contact me, and this invitation is for anyone who reads this bit of advice that I have shared with you.

I hope this is interesting to read, and that you will share these ideas with your friends. I sure wish someone had told me about it 35 years ago, when I was your age.