Beth Kobliner, author of 'Get a Financial Life,' explains why today's young people face a tougher financial world and reveals the three money moves she would make first
When it comes to investing, slow and steady really does win the race.
When Beth Kobliner pitched her book "Get a Financial Life" to publishers in 1996, they told her that young people were too busy having fun to care about money. It became a bestseller anyway.
Kobliner is also the author of "Make Your Kid a Money Genius (Even If You're Not)." She started her career helping Sylvia Porter write her syndicated personal-finance column and later wrote for Money magazine. President Barack Obama selected her to serve on the President's Advisory Council on Financial Capability for Young Americans. She now leads Get a Financial Life NYC, whose curriculum she says will be used in 70 to 80 New York City high schools this year, up from 13 last year.
In this interview, which has been edited for length and clarity, Kobliner talks about why today's young people face more difficult financial conditions than the generation she first wrote for, why prediction markets and crypto worry her, and the three money moves she would make first.
MarketWatch: What is the biggest change in young people's financial lives since you wrote the first edition of "Get a Financial Life"?
Kobliner: I wrote the first edition in 1996, and it was a time when young people, it was felt, didn't really care about money. Whereas you would never say that today about a young person, because they're not having all that much fun when it comes to their finances.
Personal-finance author Beth Kobliner.
One piece of evidence I saw recently was from the University of Michigan's Index of Consumer Sentiment. The outlook among young people 18 to 34 is worse than it's ever been, going back to 1978. So that's worse than the pandemic and the Great Recession, and it's half of what it was even just 10 years ago.
Because of the tough economic times and because of the new products like buy-now-pay-later deals that are just sweeping the market, young people are being sucked into more credit-card debt than ever before.
MarketWatch: What else is different for today's young people?
Kobliner: Today you go on social media and there are hundreds of thousands of these financial influencers, and the vast majority of young people get their advice from these people. In my conversations with high school kids, it's so clear that they don't really get or understand that what they're seeing online is not the truth.
MarketWatch: Prediction markets, where users bet on the outcome of real-world events, are drawing in young people. Why does that worry you?
Kobliner: The Wall Street Journal did a report that two-thirds of the winnings on the prediction market Polymarket go to one-tenth of 1% of accounts. So basically, these are professional Wall Street people looking at algorithms. Even though it seems like bets on what color tie the Treasury secretary will wear, or all these seemingly random things, are harmless, the fact is that people who play these are losing much more than they win.
Young people feel that there's not much hope, they'll never be able to buy a home, they may not get a job. So maybe I'll try these prediction markets and hope I'll make money that way. But chances are, by far, you're going to lose money doing that.
[Polymarket has a data partnership with Dow Jones, the publisher of MarketWatch.]
MarketWatch: If a new graduate could make only three financial moves in the first year of work, what should they be?
Kobliner: I'd say the first thing a young person should do is to pay down credit-card debt. Right now, credit cards are charging around 22%. Paying off a credit card that's charging you a rate of 22% is the equivalent of earning 22% on your money after taxes.
If you owe $1,000 on your credit card and you only make the minimum monthly payments at a 22.5% interest rate, it will take you 12 years and almost $2,000 in interest to pay it off.
The other thing is if you do have a 401(k) at work and there's matching, I would say put in as much as your company will match. If it's a dollar-for-dollar match, that's a 100% return. Even a 50-cents-on-the-dollar match is a 50% return on your money.
Maybe one more would be if you have student loans, make sure you know what's going on. Make sure you know how much you owe. Loan-repayment options now have been simplified, but the more generous payment plans are going away. You want to see which plan will cost you the least, and you want to go to the government's repayment calculator at studentaid.gov.
'Paying off a credit card that's charging you a rate of 22% is the equivalent of earning 22% on your money after taxes.'Beth Kobliner
MarketWatch: If a 25-year-old had $200 a month to invest, where should it go first?
Kobliner: I'd say the 401(k) first, if there's matching. But beyond that, I'd say an index fund. Time and time again, research shows that over 10 or 20 years, index ETFs for the S&P 500 SPX beat out the average actively managed fund.
Index funds really are very low cost with companies like Vanguard, Schwab or Fidelity. I don't have any kickback relationships with these companies, but they have really, really low expense ratios. So I would say that's the smart thing to do for young people.
An index fund buys every stock in a benchmark such as the S&P 500 instead of picking winners, and an ETF is a fund that trades like a stock. The expense ratio is the annual fee, shown as a percentage of the money invested.
MarketWatch: How much crypto belongs in a young person's portfolio, if any?
Kobliner: If someone does it for entertainment, it's a decision you could make. But just be aware that crypto still isn't regulated in ways we would hope it would be by now, and it's so volatile. So I'm not an advocate for it.
MarketWatch: How do you explain the difference between investing and gambling?
Kobliner: With gambling, you're betting against the house. They're making money on this, and I think a lot of young people don't realize that. There was one study out of the University of California at San Diego that showed 96% of the online gamblers it studied lost money over five years.
And if you look at the S&P 500 over 15-year periods of time since the 1920s, people have made money 99% of the time. It shows that if you're in it for the long haul, at least historically, that has been the case.
There was a psychiatrist at a Stanford conference who did work on addiction who said that if you tell a young person, you only have a 5% chance of winning, they think, I'm going to be in the 5%. But if you say, this is taking advantage of you, this is how they make their money, because over time you are going to lose, then that may be a better way of explaining it.
MarketWatch: Is renting or buying the better move for a young person?
Kobliner: If you're going to move in two or three years, the cost of moving and closing costs can outweigh the benefit of buying, and maybe the home price won't go up.
If you're single and you've started a job somewhere, then probably renting makes the most sense. Probably the thing that makes the most sense, and young people don't like to hear this, is, if possible, living at home with your parents. That saves you a lot of money.
In 1996, the median home price, adjusted for inflation, was $280,000, and today it's around $430,000. Back in the 1990s, the age of the typical first-time homebuyer went as low as 28. Today, the typical age of a first-time homebuyer is 40.
MarketWatch: For readers in their 40s who wish they had read your book at 25, what is the most important catch-up move?
Kobliner: The catch-up IRAs and catch-up 401(k)s. They really have improved the catch-up provisions, and you could put thousands of dollars more away per year. So if you have that money, absolutely, that's a good idea.
It can sound a little vanilla and dull, but if your point is just to work toward a successful financial life, doing the tried and true things is what it's really all about. At least that has been the case historically.
Catch-up contributions are extra amounts that savers age 50 and older may add to retirement accounts. For 2026, the extra limit is $8,000 for a 401(k) and $1,100 for an IRA. Readers who are not yet 50 can still raise their regular 401(k) contributions, which are limited to $24,500 in 2026.
'It can sound a little vanilla and dull, but ... doing the tried and true things is what it's really all about.'Beth Kobliner
MarketWatch: What advice do young people tend to ignore?
Kobliner: They're very responsive to 401(k)s, because, my company already signed me up, so I'll just increase it. When they don't listen - I could give a whole talk and somebody will come over to me at the end and say, so what stock do you think is the right stock to put my money in?
MarketWatch: If you could change one thing about how young people learn about money, what would it be?
Kobliner: Make sure that we teach young people about personal finance. New York just announced that all high school students must be taught these 33 learning objectives, everything from how to buy a home to how to pay off your credit card. But they aren't giving more money for teachers. So how do you teach the teachers how to teach this?
My curriculum is pretty easy for someone to learn and to teach. You don't have to be a math person or even a finance person.
Michael Sincere is a freelance financial writer and the author of several books, including "Understanding Stocks" and "Understanding Options."
-Michael Sincere
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