Under 26?
Every year thousands of young people join the intimidating new world of Money. In an area like Washington, with about 130,000 university students and governmental institutions that attract up- and-comers, they land in predictable waves, spilling out of schools and into the mainstream. At work, in the newspaper, on the radio, these newcomers to adulthood are bombarded with news of tax credits, itemized deductions, 401(k)s, Roth IRAs, premiums, deductibles, interest rates, credit card fees, credit reports.</br></br>The list is never-ending, yet always vaguely remote and often decidedly unhelpful. Its topics are advanced, and when it comes to the subject of personal finance, these graduates are still freshmen.</br></br>This primer is for all the young men and women who are wondering why their financial education went directly from supervised deposits into their piggy bank to the intricacies of retirement plans in 60 seconds flat. Yes, of course they should sign up with their employer's 401(k) plan. But first they have to find the job. And a place to live. And maybe a car get around in.</br></br>The guide is not meant to be comprehensive but to hit the highlights of decisions that have to be made by people who are suddenly on their own. In short, it is a sampling of the things that tend to sink a twentysomething's bank account with a loud splash -- things such as taxes, car payments and student loans. The tips tend to ask young people to examine the trade-offs of financial decisions that have to be made immediately.</br></br>For example, income tax rates differ significantly between the District, Maryland and Virginia. Young people can probably guess that it costs more in taxes to be minutes from the night-life strip in Adams Morgan, but they can find out exactly how much in the chart above.