Financial Essentials for Young Adults

Financial Essentials for Young Adults

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2017-05-07

While Millennials are the future generation with much promise, there is evidence to suggest that financial literacy is greatly lacking. Though they are more financially active, their lack of knowledge in this area could prove to be a dangerous factor to the security and well-being of their future economic lives.

Here is a checklist for Millennials to start off a healthy financial life:

Insurance

Young adults have time on their side, and building wealth and a reliable fiscal safety net is easier at this age for a many reasons, but mainly because it will help develop a good habit, and the fact that time will allow for greater accumulation of savings and payoff amounts down the road. Not to mention that, depending on the type of life insurance policy you purchase, you can lock in a lower rate than when you are older. 

The future is uncertain to be sure. What if something happens to you and you can’t work? Are you in a position to be able to continue living a comfortable lifestyle? It’s a question that, while uncomfortable to think about, is an important one to answer. 

According to the Social Security Administration, about 25% of 20-year olds will become disabled before they retire. 

That’s a scary thought. One in four young adults will not be able to work at some point in their lives before they reach retirement age. So when put in context, disability insurance becomes a lot more attractive. 

Again, the best time to open an account of this kind is when you first start working. 

Retirement

DO IT NOW while you’re young and have a seemingly endless amount of time ahead of you. Getting into the habit of saving for your future now is not only a good idea, it’s an essential idea. 

The more time you put it off, the less you’ll have saved up. Open a 401k plan with your employer, start an IRA account -- there are many ways to accomplish a healthy retirement nest egg.

Being young and having fun may be the first and only thing on a Millennial’s mind right now, but it would do a lot of good to take a moment to think about the future while they still have the luxury of time. 

It would not take a large commitment in terms of time to set up these items, and once it’s done, all you would have to do is check in at least annually to see that they are performing well. 

 

IMPORTANT DISCLOSURES

Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities. 

To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. 

Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.

These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable-- we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

David Lerner Associates does not provide tax or legal advice. The information presented here is not specific to any individual's personal circumstances. Member FINRA & SIPC

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About

Founded in 1976, David Lerner Associates is a privately-held broker/dealer with headquarters in Syosset, New York and branch offices in Westport, CT; Boca Raton, FL; Teaneck and Princeton, NJ; and White Plains, NY. For more information contact David Lerner Associates Call 516-921-4200 Visit our website: www.davidlerner.com

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Contact

Jake Mendlinger
Account Manager
Zimmerman/Edelson
516.829.8374 X 232
jmendlinger@zimmed.com

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