Millennial Advice from a Millennial
The millennial generation is defined to those born between 1981-1996. In other words, if you're between 22-37, you're a millennial (I'm 37). Like every preceding generation, we come with stereotypes: lazy, entitled, self absorbed, fickle, technology obsessed, etc. I have a different way to describe our demographic cohort. We are the first and only generation to grow up in the analog world and thrive in the digital environment. We are hybrids, a bridge between old school values and progressive ideals.
I hope you enjoy my millennial perspective for living a rich and financially sound life.
Saving, Time, and Human Capital are your Biggest Assets
Despite human nature to complicate things, the path for building wealth for young people is simple. Start early, save, and live within your means. That's it, everything else is just noise. You should also be aware your biggest asset isn't your house, car, retirement account, etc., it's your future earning power.
Avoid Lifestyle Creep
I'm on the older end of the millennial age range. Friends within my social circle are starting to advance their careers, grow thriving businesses, and make more money. There is an urge to spend more as you make more. Resist that urge. I know people that make ~$1 million per year, but live paycheck to paycheck.
Get Term Insurance
For 99.9% of young families looking for protection, term insurance usually makes sense. You can entertain whole life insurance if you're a high income earner, max out all of your retirement accounts, have zero debt, a super high savings rate, and looking for tax-deferred growth. Beware of the insurance agent who recommends whole life insurance right off the bat, they get paid a much higher commission vs. term insurance.
Craft an Estate Plan
This is important if you have assets. You basically tell an attorney what you would want to happen upon death and they can craft the legal documents. We completed our estate plan in a one hour meeting and picked up the documents the following week. I would recommend a flat fee attorney for greater billing transparency. Depending on complexity, a typical estate plan would run $800-$1,500.
My 5 year old daughter recently had a tennis lesson. I was looking for a seat in the spectator section to watch. The entire block of seats was taken by parents with their faces buried in their smartphone. I was left rubbernecking in the back to get a glimpse of my kid. I understand many of us work from our phones, but it's okay to put it away and be present. I won't always say the right thing to my kids or have the best advice, but I'll always try and give the gift of time.
Chill Out on the Social Media
Social media is good for many things, keeping up with friends that live away, networking, organizing events, and staying up on current events. However, it's easy to fall into comparing yourself to others (which is a fast track to being miserable). Especially since most people are only posting the highlight reel of their lives.
Try Leaving the Phone at Home During Weekend Social Functions
This isn't possible during the work week for most, including myself, but try it on the weekend. I started doing this a few months ago and it's quite liberating.
Quit Telling People How Busy You Are
We are all busy. If you find yourself doing this, stop and look at your calendar. Break down your day in 15 minute increments. I would bet you'll find all sorts of time-wasting activities. If you have time to binge watch Game of Thrones and play Fortnite, you're not busy, rather inefficient.
Read a Book
I've developed a mild case of insomnia over the past few years. I started reading 15 pages per night before going to bed. I still don't sleep the best, but I've noticed a remarkable improvement in sleep quality and how quickly I fall asleep.
Doing Nothing is Okay
I do my best thinking when I'm not thinking about anything. Find a quiet place to collect your thoughts, daydream, close your eyes, reflect. In the daily rat race of life, the ability to be comfortable doing nothing is a gift.
If you see a familiar face at the golf course, gym, or social gathering, but haven't introduced yourself, be first. Make an introduction. Arnold Palmer was famous for acknowledging everyone he passed, even if only a simple hello or head nod.
Conversing with Strangers
Morgan Housel recently published a blog titled "Useful and Overlooked Skills." He describes what used to be so common, the ability to have a face to face conversation between strangers, as a competitive advantage.
Recognize What Gives/Takes Energy
Most people that know me, might be surprised to hear I'm an introvert. Large group settings give me mild anxiety and can prove exhausting. I can make it through, but I need time alone or with family to recharge. I've learned to manage this by not scheduling events on back to back weeks.
The above guidance is based upon my own experiences, peer observations, and the millennial clients we serve. I don't pretend to have mastered everything I preach, but self awareness and inward reflection go a long way toward living a rich and financially sound life.