Striving For Financial Security – Financial Independence For Millennials

Striving For Financial Security – Financial Independence For Millennials

Today’s economy can feel complicated and confusing. As an affordable financial advisor in the Bay Area, I understand that achieving financial independence and stability equals an overall feeling of confidence, something most people need and crave. Struggling and living paycheck to paycheck can reduce the daily joy you experience and will not get you there. But guess what—we think you deserve it and have a strategy.

Finding the right financial advisor to help you navigate complications is essential to help achieve financial wellness. The great news is that we work with all types of people, no matter how much money they have. 

From young professionals to retirees and everyone in between, Humanity Wealth Advisors offers subscription-based financial planning in San Ramon, Newark, and the Bay Area. This can help ensure you get affordable help when you need it!

We have some simple financial advice for millennials to begin focusing more on how to achieve financial security.

Be honest about where you are today

Self-awareness is an excellent place to begin when you are seeking help to make a change. In the fast-paced world of change, immediate gratification, and short attention spans, it’s fair that you may already be losing interest in this article. But stay with me, as it could be a life game-changer!

nothing changes if nothing happensIt’s time to get honest about where you are today and what financial challenges you face. Acceptance is key to moving forward with new intent and action. 

Before planning for the future, it’s crucial to map out your present situation. This includes your:

  • Money mindset
  • Financial goals and challenges
  • Ability to ask for help
  • Current income and expenses (budget to fight inflation)
  • Debt load and credit score
  • Retirement accounts
  • Emergency fund
  • Savings

Explore your money mindset 

Clear out the old concepts of wealth and start fresh! It helps to understand your relationship with money, which is usually engrained in childhood. Talk to a professional on our team about how you think about, talk about, and use currency, so we can ensure it’s to your advantage. We are all-inclusive and do things a bit differently.

It helps to be comfortable with the idea of becoming wealthy to potentially build wealth. 

Set financial goals and name your challenges

Setting goals can help you make better financial decisions, such as where to invest your money. For example, if you are saving up for a home, knowing that your goal is to buy a house will give you something to work towards and reduce the likelihood of wasting money on frivolous purchases. 

You may also find it helpful to set savings goals with an end date in mind or an amount that needs saving by a specific time (e.g., $10,000 by December 1st). When setting financial goals, remember that they don’t have to be big or complicated—just establish what you want and start working towards it! 

As mentioned above, naming your financial challenges to create strategies can help you stay driven to change your life.

Ask for help

One of the most complex parts of making change is asking for help. As a millennial, you may have grown up having things done for you (so you haven’t had to ask for much help), or you were taught to be independent and do things independently. Well, I will tell you that some of the best money management comes from those specializing in the field. 

One of the wisest choices young investors can make is to work with a financial advisor who will provide ongoing guidance on how to strive toward a healthy financial status. 

Best practices for budgeting 

  • Don’t let money slip through your fingers: Track your spending with a budget that shows how much money comes in and goes out of your bank account each month. This will help prevent overspending on things like restaurants and entertainment, which can be challenging to keep track of in your head.
  • Spend wisely when purchasing items online or opting in for subscriptions. 
  • Set aside some “play money” monthly for your “fun items” allowance. This can help you make smarter spending decisions and alleviate financial arguments simultaneously. 
  • Try cutting out one regular item for one month that you can go without, or substitute for a cheaper option. See how much you can save!

Take maximum advantage of a company 401(k) plan

The 401(k) is a great way to save for retirement. You should contribute as much as possible — especially if your employer matches it. Doing so can provide a sweet return on investment: free money!

Create an emergency fund

A good emergency fund is the cornerstone of financial confidence. If you can save up at least six months’ worth of living expenses, you’ll be prepared for anything life throws at you—from job losses and health problems to sudden major purchases or unexpected expenses like a car repair.

While building up a safety net may seem intimidating, there are many ways that young people can get started with saving money:

  • Reduce your spending and look for ways to cut back to free up more cash for savings.
  • Cut cable or cancel your gym membership if those expenses aren’t essential for your life at this point (use a free exercise app instead).
  • Don’t buy things on credit—pay cash whenever possible so that none of your money goes toward interest charges!

Save for retirement in a tax-advantaged way

The earlier you start saving, the more interest and money you can have by the time you retire. In addition to saving through your employer-sponsored 401(k), or Roth IRA, consider other savings plans such as a 529 college savings plan for children.

You will want to ensure that your investment options are diversified and stable enough for now and when it comes time for retirement. Work with a financial advisor in San Ramon for tax planning help to potentially build wealth.

Debt reduction and improving credit

Debt reduction + improving credit

  • Learn to manage your debt
  • Build and improve your credit score
  • Avoid unnecessary fees and interest rates

Work with a financial advisor to take action to pursue your financial independence today

Remember the idea and practice of asking for help?

As the founder of Humanity Wealth Advisors, my most important advice is not to wait until you hit rock bottom and realize that your finances are out of control. If you want guidance on achieving your financial goals, find someone who can teach you how to pursue your financial independence today.

The key is to create a financial plan and keep your eye on the prize.

A Simplified Retirement Planning Guide! Here are five easy steps to begin.

Use these steps to help improve your future. The key is getting started and sticking with it. Remember that financial confidence is not just about money; it’s also about being content with what you have. 

Build a solid financial foundation for yourself to enjoy more freedom later on in life. Reach out for assistance to get the ball rolling, or opt-in for subscription-based financial planning!

Humanity Wealth Advisors and LPL Financial do not provide legal advice or tax services. Please consult your legal advisor or tax advisor regarding your specific situation. Investing involves risk, including possible loss of principal. A Roth IRA offers tax deferral on any earnings in the account. Qualified withdrawals of earnings from the account are tax-free. Withdrawals of earnings prior to age 59 ½ or prior to the account being opened for 5 years, whichever is later, may result in a 10% IRS penalty tax. Limitations and restrictions may apply. Prior to investing in a 529 Plan investors should consider whether the investor’s or designated beneficiary’s home state offers any state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in such state’s qualified tuition program. Withdrawals used for qualified expenses are federally tax free. Tax treatment at the state level may vary. Please consult with your tax advisor before investing.

More about the author: Harry Sherdil

As a fiduciary financial advisor at an independent firm, Harry strives to offer the same resources, tools, and research as bigger firms while serving new and existing clients' best interests.