Right now would sure be a crazy time to be young and looking to start investing.
Inflation, war in Ukraine, the recent crypto and banking scandals, fears of a global recession and tensions with China — all of these issues have made Wall Street a very scary place, and even the Federal Reserve doesn’t seem to totally have a grasp on what’s happening with the economy these days.
But there are young professionals — workers in their early 30s who may have just now decided it’s time to start getting serious about investing.
So what do they do? Who do they call? What should their strategy be?
Joseph Lindner, a senior wealth advisor for Pioneer Wealth Management, part of Pioneer Bank, says young investors should first look at their life as a business.
What does their bank account look like? How much debt do they have? How much savings do they have for emergencies? These are questions that people have to ask themselves before they consider how, or whether, to invest.
“The real job is to educate yourself,” Lindner said.
Lindner was asked to consider a 30-something worker who has been dutifully making contributions to their employer’s 401(k) retirement plan for several years. Maybe they recently inherited $5,000 from their grandparent that they are looking to invest on their own. What should they do?
Lindner says that 30-somethings must first look at their credit cards. If they are carrying balances on cards with high interest rates, those should be paid down or off completely — it’s like making 15 percent on an investment when you eliminate high-cost debt on credit cards.
The next thing to do is to look at savings. Lindner suggests that people have enough money saved to get by for six to 12 months if they lose a job or can’t work for some reason.
“Try to…
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