10 Mistakes Gen Y Makes with Advisors
1. Not Having an Advisor Help with Big Financial Decisions
Keep in mind that you are dealing with a financial advisor, not a stock broker. If you can’t tell the difference you’re dealing with the wrong person. Big financial decisions affect your plan, your investments and your future. The role of a financial advisor is to advise you on all the important financial decision you make.
2. Not having a spending plan in place
As Dave Ramsey is fond of saying: every dollar should have a name.
3. Not “paying themselves” first rule
First pay yourself by putting some money aside. If it’s hard , have it done automatically so you don’t have to do it yourself every payday.
4. The Ones who Make Less Money Can be Less Receptive to Advice
Poor people are poor for a reason, and that reason is often that they don’t want to take advice.
5. Not Appreciating their Long Time Horizon in Investments
The biggest asset that a young person has it time. They may not have much money but the magic of compounding turns a small amount into a big amount over time.
6. Itching to Get Ahead Professionally
It takes time and patience to get ahead. An advanced degree does not necessarily let you skip rungs on the ladder of success.
7. The Budget Cliche
If you don’t know where you’re money’s going it’s impossible to know where to economize. There are several good computer programs that can help you keep track of where your money is going.
8. This Generation Struggles with Insurance
It’s the young professional who is most in need of insurance and who is apt to put off getting it until it’s too late.
9. Working with “Old School” Advisers
The old school advisor is really a stock jockey who doesn’t bother to listen to your needs but promises to “beat the market.” This person is not an advisor, he just wants to manage your money.
10. Planning too far out
Too often people get a lengthy, expensive “financial plan” that projects the future 40, 50 or 60 years out. That’s nonsense and a waste of time and money. Simple plans of a few pages are better and should be reviewed annually and updated with new information. Keep in mid the old saying: the map is not the territory.