- For many, money management is about fear, but Certified
Financial Planner Eric Roberge, says it doesn't have to be. - When investing, it's recommended that people use rational investment strategies that help you meet your goals without as much risk.
- Most importantly, don't wait to start reaching your financial goals. "Action is everything."
As a financial planner, I specialize in working with Gen X and millennial clients. I've been doing this for over 10 years and have worked with well over a thousand people. Given that experience, here's what countless clients have taught me over the years — and the biggest insights I've gained.
Manage your emotions as well as you manage money
Financial success is about emotional management, not just money management.
Often with money, the emotion is fear: fear of loss; fear of missing out; fear of getting it wrong. That fear drives people to act irrationally and to make mistakes that cost far more than simply taking a step back and waiting for that feeling to pass.
If you want to grow wealth, I highly recommend working on your mindfulness and self-awareness. Is this a little woo-woo? Maybe. But it works.
The more you're aware of your own feelings, where they come from, and can create space to react instead of just emotionally respond, the more financially successful you're likely to be.
Don't be tempted by trying to hit home runs with stock picks
Most people screw up their investments because they're trying to find the next Apple. As a result, they make speculative bets in the market… but that's not investing. It's gambling.
When you invest sporadically and consistently lose little by little, you're not going to have much to show for it when you need a nest egg. Instead of trying to be a hot-shot stock picker, choose a rational, evidence-based investment strategy that allows you to earn enough return to meet your goals without taking on undue risk.
The most important thing you can do to grow wealth? Just start.
Don't wait until you think you have the perfect
Don't wait, period.
Haven't started investing? Open a Roth IRA, pick a target-date fund, and set an automated contribution.
Not paying off your debt because you feel overwhelmed? Take a deep breath, acknowledge how you feel, and sit down to make a list of your debts in order of interest rate, highest to lowest. Start paying them off in that order.
Feel completely stuck and unsure of what to do next? Ask for help. Research your questions, search for financial literacy classes, or reach out to a fee-only financial planner.
In my experience of working with thousands of millennials and gen-Xers, I immediately know who will reach their goals and who will fall short. It's the people who are willing to roll up their sleeves and do something in spite of any excuses or reasons for why they can't.
They believe they can, so they do. Action is everything.
The article was contributed by Eric Roberge, CFP and founder of Beyond Your Hammock.