Meet Catherine, our millennial composite. She is 26, having finalized formal education, now with four years plus in the workforce, and a disciplined savings account established, is feeling confident about her current career. The tough COVID-19 lock-downs generated much introspection, too, about what directional path she will take in life, what goals should she strive for, and how will she finance her future security and happiness.
There are compelling reasons to consider investing, three of the most important:
Calculating the Life-Long Game
There is great longevity in her family. Her mother, her grandmother, her great-grandmother; all widows, all still alive, are all still productively thriving in Bermuda. In actuality, it is not the least bit unusual to see longevity-patterns in similar islander families.
Catherine’s lifespan, currently, is statistically projected 60-80 years into the 2100th century. Her savings alone will never appreciate at the statistically-proven long-term investment appreciation rate.
Building on Financial Independence for Financial Serenity
COVID’s indiscriminate, tragic abruptness in lives lost has heightened its consequential reality, that every adult individual, ladies in particular, must independently take responsibility for their own personal health, and financial security.
Catherine’s role model, her great-granny (GiGi) preached that same mantra for years. GiGi lost her spouse unexpectedly at a young married age, but she carried on, managed scarce resources through a World War, numerous recessions, while working full-time and raising her children. With few social benefits then, financial survival depended on one’s own initiative.
Investment Knowledge Enhancement
In the 21st century, every commercial / non-profit entity, government and jurisdiction is connected directly or indirectly to global capital investment markets with products and services ranging from the very basics – equities, debt, commodities, fiat cash – to complex high-speed trading algorithms, digital blockchain/cryptocurrency technology, and the latest ESG – corporate social responsibility commitments.
The global pandemic enforced isolation also generated a significant surge in capital markets’ activity. Thousands of new investors, powered by millennial groups, were collaboratively investing on social media platforms. Numerous individuals’ exuberant running commentaries – on securities, cryptocurrencies, sustainability/social values, their profits, losses and life in general, were unabashedly blunt and starkly thought-revealing.
Catherine, like most of her generation, is Digitally-savvy; she is well aware of the surge in social media investing phenomenon of her peer group. Astutely, she feels possessing a good working knowledge of investments relative to her global industry employer will be fortuitous career enhancement.
So, it is a good time to participate, but she’ll want some professional guidance because her hard-earned savings warrant very thoughtful investing decisions. Further, while her career is already time challenging, she may be possibly on the cusp of increased family caregiving responsibilities.
Consulting with a qualified financial planning professional that she can relate to, work with, trust, and have confidence in this individual’s objective advice along with providing investing education support, she decides on a two-factor investing plan that will work best for her: understandable, practical, and impactful that addresses her (ESG) socially responsible values and is appropriately diversified for risk comfortability:
- the majority of her continuing savings will be relegated for long-term growth management, to build an investment portfolio for her future financial security, while
- the residual savings will be allocated to exploring and learning various other investing formats: roboadvisors/digital-investing, traditional basics and more utilizing her financial advisor’s firm umbrella.
Her trusted advisor will conduct a holistic evaluation of her life profile, and her current finances to understand her:
- Health assessment
- Time span
- Risks and liabilities
- Mobility possibilities
- Real estate ownership
- Educational funding
- Family welfare and potential elder care
- Retirement/pension planning
- Adequate Estate/beneficiary planning
- Multinational / multi-jurisdictional tax / financial implications, if any
- And more
Once her life profile is analysed, suitable recommendations complementary to her lifestyle, are presented for review/acceptance, followed by a collaborative implementation.
Her plan is now in place. It is a life-long process, developing, enhancing security as her invested assets appreciate and career trajectory grows; then, later, rebalancing, re-evaluating, retrenching to a more appropriate portfolio allocations can be considered as her life span increases and tolerance for risk decreases.
Catherine feels in harmony with her trusted financial advisor and is very confident in taking these progress steps toward her future financial security.
Catherine is investing for the long game, the very life-long game.
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For more information, visit www.clarieniinvest.com
Martha Harris Myron, a native Bermudian with US connections, is a qualified international cross-border financial planner, the author of The Bermuda Islander Financial Planning Primers, since 2016, a Google News Contributor (50+ articles), international financial consultant to the Olderhood Group Bermuda Ltd., and financial columnist to The Royal Gazette. Contact: email@example.com