Millennials & Money: 5 Simple Principles to Build Lasting Wealth
At Arista Wealth Management we are regularly asked by our clients to visit with their “millennial” children and share our expertise on ways to manage their money and build their wealth. Below is a list of the 5 simple steps that can help anyone get their finances in order.
Principle 1 – Know Your Numbers and Live Within Them
Understanding and controlling how much you earn, save, spend, and invest is a habit that will benefit you throughout your life. Not only will it help you to spend less, but ultimately you will save more and grow your wealth.
Principle 2 – Avoid Debt Like The Plague
There are two kinds of people in this world; people that pay interest and people that earn interest. You can decide which one you are. Millions of Americans are buried in debt and cannot get out. Creating and maintaining healthy financial habits early in life can save you from a lifetime of financial struggles.
Principle 3 – Start Early and Often
The greatest tool a millennial has is time. One of the best ways to build wealth is by consistently investing a percentage of your earnings through time. Get rich quick schemes and speculative investments are generally dangerous and ineffective ways to build and maintain wealth.
Principle 4 – Nobody Knows
Throughout your life you will undoubtedly hear “investment experts” make claims that they know in advance which stocks will perform well and which stocks will perform poorly. Anyone who claims they can predict the market’s future is only guessing. The truth is, nobody knows what markets will do over short periods of time. We believe you are best served by investing in low-cost mutual funds/ETFs that provide you with global diversification.
Principle 5 – Worry About What You Can Control
You will never be able to control the markets or consistently guess which stocks will outperform. However, you can control how much you earn, save, spend, and invest. Over the last 20 years, the markets have rewarded investors who control their emotions and take a disciplined and consistent approach to investing. Start small but dream big because it’s never too late to get started.
By applying the all principles listed, you and your millennial will be well on your way to financial success. Please feel free to contact us for additional information or investment guidance.
Arista Wealth Management, LLC is a Registered Investment Advisor