An unprecedented news flash of earlier this year read: Millennials overtake Baby Boomers as America’s largest generation¹. No wonder parents routinely ask us what advice we have for their millennial offspring–especially their daughters. Well, we have some suggestions and discovered in writing them down that they apply to a larger audience than just Millennial women. So read on!
Affluent Millennial women and those in the process of growing their wealth are known for being highly ambitious, educated, and dedicated. They have redefined what success is and they work hard for their assets. As women of increasing wealth, what do they need to know about taking care of their money?
First and foremost, affluent millennial women need to take charge of their money. Whether they earned it, inherited it, or received a substantial divorce settlement, the decision to take responsibility is paramount. Sound a bit intense? There is a good reason for the passion behind this statement.
As a woman Certified Financial Planner™ professional for the past fifteen years, the number one mistake I have seen women make is to deflect financial decision-making responsibility to a man in their life–whether their father, another male family member, or–often the most damaging of all–to their love interest. No matter how gorgeous, sexy, charming, or authoritative, I can pretty much guarantee that the spouse or life partner in your life will not do a better job managing your money than you will.
Time and again I have witnessed that special person in her life dissipate, spend in ways not aligned with her values, and often just plain take her wealth while she stands on the sidelines wanting affection and rationalizing she doesn’t know enough to make her own choices. Remember, such rationalizations are past thinking. Happily, we are in the twenty-first century and you, as a powerful force to be reckoned with, do know what to do. Or you can avail yourself of the resources you need to figure out what to do with your affluence–so you can fulfill your values, needs, and interests as well as avoid losing your wealth.
Tips for Millennial Women
Tip number one to all affluent millennial women is to take charge of your wealth planning. Tip number two is to avoid the “Just sign here, honey!” syndrome, as described above when that special someone is given authority over your personal finances. Tip number three is to consider the benefits of finding a competent wealth advisor to help you achieve all that is important to you with respect to your money.
To help with tip number three, here are a couple of guidelines for selecting that all-important advisor:
- Work with an advisor who has attained the Certified Financial Planner™ credential. This professional is seasoned in the aspects that can help you maintain your financial well-being as well as achieve all that is important to you. Search for professionals in your area: http://www.cfp.net/ When you visit the websites of the CFP® professionals you have identified, make sure they are comfortable working with your team of advisors, such as your CPA and attorney.
- Then, during the initial consultation with the advisors under consideration, take note of whether they listen to you, educate you as the conversation unfolds, and have a long-term perspective focused on you. If all they want to discuss is their great investment products, watch out! Your long-term financial success is built upon what you need and what is important to you, not on a product.
Tip number four for wealthy millennial women is to make a spending plan. Yes, even with the best advisor, if you are not quite sure where your money is going (your expenses), you may be in for unpleasant surprises down the road. Never assume you know; be precise about what comes in and goes out; I believe your sense of command over your personal finances will grow accordingly.
Tip number five is to “get started.” No matter what your former experience, muster your courage and begin taking charge of your personal finances now. Even baby steps right now will likely result in better than ever tomorrows. If you are not sure where to begin, I created a how-to guide, complete with exercises, to get you going on your journey– Balancing Act: Wealth Management Straight Talk for Women. All proceeds from the sale of this book benefit a scholarship fund at Temple University.
I predict a couple of phenomenal outcomes when affluent millennial women choose to take charge of their money. The first is they will be better able to take care of themselves and their families no matter what curve balls life throws their way. The second is that women are charitably minded, more so than men, and often serve as a catalyst for social change, change that benefits not only their families but all of us.
So whether you earned your wealth, inherited it, or received it in a settlement award, I challenge you to take responsibility for your money. Learn what you need to know, make choices, and enjoy the experience of growing financial confidence that results.
¹FACTANK: News in the Numbers, Millennials overtake Baby Boomers as America’s largest generation, Richard Fry, April 15, 2