Planning for retirement can seem like a daunting task, but it doesn't have to be. My ability to sort through all of the seemingly complex financial information will help in working towards giving you greater satisfaction as well as someone that you can depend on, to help guide you, in all of your financial decisions. We will work together to align the various investment choices along with your personal goals to help give you the confidence you need on your journey down the path to retirement and beyond.
Millennials are often portrayed as the black plague for our country’s future. We are referred to as lazy, ungrateful, and incompetent. The consensus is that we will be detrimental to the future of our country because we don’t have a clue, but just how could that be? We are just beginning our adult lives and haven’t had a real impact on hardly anything yet. Most of the issues we face today started well before we were born. With our generation inheriting a seemingly endless national debt, a monumental student loan crisis, and little to no social security to utilize, how on earth could the most financially distraught generation be portrayed as becoming the wealthiest ever?
Here’s some insight into answering that question…
Entrepreneurship: Millennials have an undeniable drive to be independent and receive any and all praise associated with their accomplishments. What better feat to tackle than an aspiration to become self-employed? Unlike any generation has seen before, millennials are overhauling the entrepreneurial world. With the advances in technology, working remotely is seemingly becoming the norm and what generation is better suited to work from anywhere utilizing the vast array of technologies available to us than millennials? With small businesses popping up all over, millennials could really help strengthen the backbone of our economy and propel us into having a financial surplus instead of an overwhelming deficit. Come on you twenty and thirty-somethings! Launch that business you’ve always wanted to and get moving on changing the world already!!
Tactical Investors: Unlike generations before us, pretty much all millennials know, is a lagging economy and down markets. We don’t really know what it’s like when times are good. Small peaks we’ve experienced throughout our time as investors has given some millennials hope, but for the most part all we understand are uneasy market conditions and matching reactions from friends and family when it comes to investing. We have lived through the dot-com bubble; which burst in 2001, we have seen our country go into the Great Recession after the financial crisis in 2008, and we have seen the markets experience severe volatility in-between, making investing more and more difficult, especially for those emotional investors (and we all know millennials are the generation of feelings). Millennials however, (resilient as we are J) have been able to take advantage of most, if not all of these negative market conditions; because time is on our side. We have 30-40 years until retirement and will likely experience more economic downswings in the future. These dips create an excellent buying opportunity and many millennials have been able to buy in low and reap the rewards when the market returns to normalcy.
Technology: Advances in technology over just the past three decades have significantly changed the course of our future, in many aspects. Computers that used to fill the size of a room can now fit in our pocket. Waiting for the internet dial-up to connect is a thing of that past whereas now if your BuzzFeed article takes more than 6 seconds to load, it’s no longer important enough to read. Our leaps and bounds in technology will continue and the hope is, that it will further propel our economy into financial soundness. Trades on the stock market that used to have to be called in on a landline phone (I’m sorry, what is that again?), are now done in mere nanoseconds from the palm of your hand. There is unprecedented access to financial tools both for education and investment purposes. We can now invest spare change if we so choose! The benefit of all this to my fellow millennials is; if we start saving early and can utilize the power of compounding interest, a significant increase in wealth will be realized.
Millennials are a unique generation. We have endless opportunities available to us that weren’t available to previous generations. We can work from virtually anywhere, we can be tactical, and we can use our advanced knowledge of technology to make financial decisions with the touch of a finger. Being able to learn from mistakes made by our parents and grandparents has given us the tools to understand patterns and what doesn’t work, and has truly set us up for success. We must not forget what has happened throughout history, or we will be bound to repeat it. If the millennial generation can really hone in on our talents and all the opportunities and wealth of knowledge the twentieth century has provided for us; I believe we can very well become…the wealthiest generation of all time.
The generations that pre-ceded the millennials typically have a different way of thinking when it comes to money. Does this mean that we shouldn’t take their advice and follow in their footsteps? Not exactly, but take the advice with a grain of salt. The financial world is ever changing and the one that previous generations grew up in is vastly different than the world we live in today. Here are a few of the topics that advice is commonly given on:
1. We hear “Don’t get a credit card.” – You should actually get a credit card to build up your credit. Just because your parents or grandparents paid for everything in cash, doesn’t mean that you can’t use this tool to help grow your credit score. A prompt and consistent record of credit card payments can have a significant impact on curving this score. There are also some significant rewards associated with certain credit card providers that can provide for numerous rewards such as cash back, airline vouchers, and hotel stays.
2. We are encouraged to “Buy a house.” - We have commonly heard the logic of “you got your first job, it’s now time to buy a home”. Our Parents and Grandparents have always said that buying a house is the best investment you can make and that there is nothing better than owning a home. Home ownership may be a right fit for some people and some situations but it is most certainly not a one size fits all answer. You may be fresh out of college with a new job. What happens if you get promoted or transferred to another region. It would complicate the situation if you were tied down with a mortgage. By renting through your first few years of your new job, you also will not have to worry about maintenance and upkeep expenses. This is not only limited to monetary expenses, but also a time expense as well.
3. Be sure to “Invest all your cash.” – It is important to invest your money, but it is equally as important to have an emergency fund. Unexpected life events happen and typically when they do, we need to have quick access to cash. It is crucial to make savings an expense. Get in the habit of systematic saving, not only in investment accounts, but in your bank accounts as well. I encourage my clients to set a threshold of the amount of cash they want to have in their emergency fund. Once we exceed that limit, we will look at investing the surplus.
There should be a disconnect between family and friends when it comes to advice with your money. You should work with an advisor that will be able to give their unbiased opinion and assessment for your unique situation. Investing is such an emotional event that affects each and every one of us. It is important to have that unbiased opinion come in to make the determination of when to take action or whether or not to stay the same course.