A large number
of financial forecasts made over the last decade suggest that the outlook for
millennials is bleak. While there is evidence that millennials may face some
financial obstacles specific to their generation, it is also true that sound
money-making decisions can defeat these obstacles.
Jacob Gottlieb
is a financial advisor that serves as the chief investment officer and a
managing partner at Visium Asset Management. Gottlieb received a bachelor's
degree in economics from Brown University where he graduated Magna cum laude.
He completed his education with a medical degree from the medical school at New
York University.
Jacob Gottlieb
took a moment to outline a few financial planning tips for the benefit of
millennials.
Buy An Affordable House
Gottlieb
explains that the benefits of owning your own home will in most cases outweigh
any of the potential negatives. The key ingredient to this formula is to not
commit too much of your money to the property. A good rule of thumb is to never
purchase a home that costs more than two and a half times your annual gross
income.
Fifteen Percent Of Your Income Should Be Saved
Long-term
financial health is best safeguarded by the creation of a budget that is
carefully followed. The millennial who commits 15 percent of their income to
savings will begin to watch their nest egg grow in a short while. It is
suggested that savings equal enough money to pay all financial obligations for
six months.
Eliminate Student Debt
A major
concern for millennials is student loan debt. Student loan debt can not be
eliminated with a bankruptcy filing. Also, the interest accrued on this debt is
never-ending. The millennial that takes an aggressive approach to student loan
debt repayment can potentially realize savings in the tens of thousands.
Begin Funding Retirement Early In Life
No one
possesses a crystal ball that will allow them to know the end of their
productive work life. Because of this, you should begin investing in an
employee sponsored 401k plan as early in life as possible. A Roth IRA may be
more suitable to the needs of some individuals based on the type of work
performed, earnings that are expected, and anticipated age of retirement.
Pay Monthly Bills Early
The fees
associated with late and missed bill payments can add up to a hefty sum. This
money would be better spent on a variety of things or added to savings. Late
payments will also negatively affect your credit score and add to interest
payments when borrowing money.
Master Tax Deductions
The United
States allows for much money to be saved on taxes by the individual that
masters the process. The majority of Americans cost themselves money every
income tax season by not maximizing deductions. It may be a good idea to employ
the services of a tax consultant to lower federal and state income taxes be
exploiting allowable deductions.
Utilize Passive Income Streams
Successful
people often add to their incomes with investments that don't require physical
effort from them. Popular investments include rental properties and unimproved
land. Other citizens have benefitted financially from purchasing intellectual
property rights and later collecting royalties.
Continue Your Financial Education
Your personal
balance sheet will improve continuously along with an improved knowledge of
financial matters. Financial blogs, publications on economics, and information
dispersed by experts like Jacob Gottlieb can support efforts to develop a strategy to accumulate wealth. The
millennial that takes a moment to learn a little bit about financial matters
each week will have a powerful knowledge base with which to work in only a few
months.
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