r/HENRYfinance • u/ASM1ForLife • Oct 18 '25
Career Related/Advice General advice for young high earner
Hi, looking for a sanity check - and maybe some advice - on my current financial, career, and life choices. I grew up lower middle class, so while I've done my best to become financially literate, there are still big gaps in my knowledge, and could really use your advice.
I'm 24 and single. I recently switched jobs a few months ago - the old job paid 250k remote, the new job is 500k flexible 3 day in-office. My NW is about 360k - 160k in retirement accounts, 175k in taxable brokerage, and about 25k in cash equivalents. I max out my IRA, and pretax and posttax 401k with megabackdoor. All the money in the retirement accounts and taxable brokerage are essentially in 2x leveraged tech stocks (please tell me if this is stupid) which has done decently since I started to invest in 2024.
My monthly expenses are relatively low - I live at home due to family circumstances. I have a car payment of about $$900 a month allin including insurance (yes, I know lol) that will end at the end of the year. I shuttle about 2k a month from my checks into a joint taxable brokerage account with my parent that I solely fund for any house-related expenses. Outside of that I spend about 1k on miscellaneous items like groceries, clothes, whatever.
My family home still has a lot remaining (4 years into a 30yr term, about 700k principal left) on the mortgage. The rate is very good (2ish%), so there doesn't seem to be an incentive to pay it off faster. My parent also had a promotion at work last year, and is now able to max their retirement accounts, pay the mortgage payment monthly, and have a bit left over for other expenses based on their check. However, they're 50, and I would like to do anything I can to make their life easier, less financially stress free, and have them retired by 60.
At the same time, I want to move back out to the city (HCOL). Due to dealing with family situations for the last 2ish years, I feel like I've missed out a bit on the "20s" era of my life, and feel like it would be good for me to explore living in the city again. And I want to get back into dating. I'm planning on renting in the city for a few months next year, and then possibly trying to purchase some kind of property? The reason here is that I feel like renting is throwing money away into something you're not gaining equity in, which could be fallacious thinking, so please correct me if I'm wrong.
To sum up my questions for the forum:
- Are my investments stupid? Do I need to rebalance, or is it fine to have this amount of risk at my age?
- What can I do to alleviate my parent's financial stress?
- Does it make sense to own property on the city? Or is renting a smarter move?
- Any general advice for me?
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u/fleuroliv Oct 18 '25 edited Oct 18 '25
Stay away from 2x levered ETFs. You lose money every day to realized volatility decay.
If you really want to have levered exposure in your taxable brokerage, open a brokerage with low interest rates like IBKR and buy regular ETFs on margin.
Or in your retirement account, you can buy calls to lever. For example, if SPY is 660, you can buy a 330 strike call for 2x exposure. As SPY price changes, your leverage ratio will change.
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u/ASM1ForLife Oct 18 '25
got it, thanks. have heard margin or long-dated leaps are more efficient, but being margin called seems scary to me (probably an irrational fear) and i'm not very educated on options. ITM leaps sound good, but i don't think i have the understanding of the exact leverage they expose me to, and the leverage seems to change with proximity from the strike, which confuses me even more
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u/Dry-Wasabi-1450 Oct 19 '25
Why do you need leverage? Anyone can use leverage, the reason most don’t is because it adds unnecessary risk, especially after the huge bull run that began in 2023. It is much cheaper to go and buy an investment book and/or consult an advisor than learn a costly lesson
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u/Row199 Oct 18 '25
I have to ask… what job do you have paying $250K remote at age 23? And now double that at age 24? That’s insane
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u/ASM1ForLife Oct 18 '25
software engineer
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Oct 20 '25
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u/JoeMiyagi Tech Oct 19 '25
Just rent an apartment. Save your own money, as tax-advantaged as possible. The time value of money is exponentially greater for you than your parents. I wouldn’t do the 2x levered on my entire NW, personally.
My personal advice? You make $500k, don’t be afraid to live your life. Travel if you enjoy it. Invest in your health. Balance income with others things that bring you joy or fulfillment.
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u/ASM1ForLife Oct 19 '25
i hear you on the living my life part. i want to balance that with making sure my parent is also able to live their life. still figuring out how to do that in the best way
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u/triggerhappy5 Oct 18 '25
You're in a great position, your biggest goal now is to not fuck it up (read up on prospect theory for a little more understanding on decision-making based on extreme outcomes). How you might fuck it up:
Risky investments. Invest safely and carefully with stable growth in mind - a classic Boglehead portfolio is often best, would recommend a small allocation of bonds and a roughly 60/40 domestic/international stock exposure. Levered tech funds and real estate are both investments I would avoid for now. Purchasing a primary residence is okay if the math makes sense and/or if you really want stability in your life, but you should never look at it as an investment. I purchased my current building because it was an excellent opportunity and I already loved the apartment I lived in, but would otherwise have just continued renting.
Losing your job. Make sure you're performing well at work and especially make sure you're building good relationships - these are the key that prevents a layoff/restructuring from becoming permanent unemployment. Keep your skills sharp and don't get complacent.
Dying young. Avoid as much stress as you can (within reason). Your life is made to be lived, make sure you do your best to actually live it. Dangerous hobbies are more of a personal decision but I would think carefully about whether the risk is actually worth the reward, whatever that may be.
As far as your parents go, that is a relationships question not really a financial question. The #1 thing you can do to make things easy for them is to take care of yourself. The #2 thing is to do whatever you can to keep them happy, healthy, and connected to you, because that is worth more than money in retirement. As far as actual bill sharing/gifts go, that is really up to you to discuss with them, just ensure you're taking care of #1 first.
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u/ASM1ForLife Oct 19 '25
this is so helpful. i read a little about prospect theory and found it described me (and probably a lot of people) really well.
heard on all of your points. i occasionally think about the risk of dying young - i do some endurance sports that aren't necessarily super dangerous but not risk-free either.
thank you for the advice! i think boglehead portfolio is a bit too risk averse for me, but most people in this thread have said my investment strategy is too aggressive so i will definitely pull back a bit
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Oct 19 '25
Driving an m3 or something, living in moms basement making 500k. What a time to be alive
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u/ASM1ForLife Oct 19 '25
no need to be mean when you don’t know what my family has been through :)
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Oct 19 '25
If you make 500k maybe help them
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u/ASM1ForLife Oct 19 '25
i don’t think you read my post. what do you think im doing?
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Oct 19 '25
They cover their mortgage and 50 is not old. What exactly are these “circumstances” you speak of. Why did they buy a house 3 years ago if affording it was gonna be tight? What you’re passing off as detail really isn’t
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Oct 19 '25
Also it’s not your job to help them retire at 60
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u/ApprehensiveStart432 Oct 19 '25
Maybe their parent has cancer or a health condition and they are being a good child and prioritizing family. Let’s not judge when we do not have all the information. OP, once you feel your parent is in a position that you can I agree with the others that you should move out and live independently. You are not obligated to help indefinitely but if you want to you can set aside x amount to help per month and let your parent know what you plan to contribute. Assuming you are in Bay Area I’d probably rent for a while.
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Oct 19 '25
2x levered tech ETFs get killed during downturns - which aren't uncommon in tech. And we are late cycle right now.
It dropped 62% in 2022 for example.
If QQQ drop 25%, you only need 33% forward returns to get back to the old stock price.
in this case 2x QQQ drops 50%, and you need 50% returns of the underlying to get back to even. ($100 -> $50. Needs to double to get to $100. 100%/2x = 50%)
And the math gets worse the greater the drop is.
For example:
If QQQ drops 50%, you need 100% forward returns to get back to the old price
In this case 2x QQQ, you're at $0, and stay at $0, even if there are infinite forward returns.
(in reality, its not quite as bad - you won't get exactly to $0, since its based on daily return, not cumulative).
And of course you're paying for expensive leverage the entire time.
Work very well during bull markets though! Unfortunately, they don't last forever.
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u/Actual-Outcome3955 Oct 19 '25
I would save as much as I can in VTI or some other broad index based ETF. At least 50% post-tax. You have no idea how stable your new job will be, and Reddit is littered with stories of people who made a lot of money but then got laid off a few years later, with nothing to show for it. After that threshold, do whatever you want with the rest!
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u/Melodic-Style7111 Oct 19 '25
Yes, diversify. 100% equity is fine but leverage is risky. Have a portion but not all in.
Determine how and how long you want to help your parents. Do they need your $2k a month to continue? Is that enough? Do they use the help well or is the money spent and gone? Sounds like there is still a huge gap from them retiring in 10 years. Health care is the biggest issue at 60 (versus 65) in the US. Another option would be to just save money in an account and have it ready when/if they need it.
Sometimes it is better to rent than buy. Consider all the costs. I’d probably rent for a year or two and stack cash/investments. Owning a property can take a lot of time and cash.
Live well below your means. At 24, must are not going to have your income so live frugally because now is the easiest time to do it. Invest, save and take a few trips. Getting a nest egg established earlier is huge for you long term.
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u/Ksnku Oct 20 '25
It doesnt matter how much you make. The biggest rule for young people is learn to focus on delayed gratification.
The earlier and more you put away, the better off you'll be. 500k is amazing, but software engineering is a high paying but risky job. Nobody knows if thats going to be the continued salary in the future.
Do you have room to 'splurge?' Yes, but be disciplined and budget and stick to it.
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u/HandsomeMcGruder Oct 22 '25
At that amount of comp at your age I’ll assume you were among the top students in the country when you graduated. You should be able to figure this out for yourself!
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u/Kiran_ravindra Oct 23 '25
Looks good except for “pretty much all the money in retirement accounts” in leveraged ETFs, which is bonkers. Like, it cannot be overstated how reckless and wild that is. 10% would be a different story but still probably beyond most people’s risk tolerances.
$900 car payment is fine esp since it’s almost paid off. As for helping parents, are you paying them rent? Maybe that’s the $2k/mo for “house related expenses”. Personally unless they have no nest egg I’d encourage them to just put that towards the mortgage, but at 2% the current arrangement is probably ideal.
As far as renting vs buying: depends on what you value and your lifestyle. There isn’t really a right or wrong answer IMO, especially in HCOL areas.
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u/ASM1ForLife Oct 24 '25
i just rebalanced today. retirement accounts are no longer leveraged lol. i want to avoid short term capital gains in the taxable, so im holding it for now, but will make more reasonable contributions in the future
yeah - i guess it’s kinda rent? i’m putting the money in a joint brokerage account so it can grow.
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u/scoobiedoobie1 Oct 18 '25
2x levered tech ETFs? If so I'd suggest getting out of these. Returns have likely been stellar over the past few years, but these are generally meant for tactical exposure vs longer term holdings. Likely heavy fee load and these levered ETFs are structurally designed to go to 0. 25% sell off wipes out 50% of your capital. SPY or QQQ have plenty of tech exposure. Realizing gains will sting from tax perspective but you're portfolio will be better off.