Tax Blog

The Ultimate Financial Guide for Millennials

Remember that satisfying spinner in The Game of Life? Tick, tick, tick, and then it stops, and you count the steps to your next move.

Novice players often marvel at how early discretion can provide such big pay-offs by the end of the game. Players who were slower at the beginning gain the power to boost ahead of their more short-sighted game opponents.

In real life, millennials are in the first part of the game of life. Real-life is full of similar choices and pay-offs. What key financial insights do millennials need to know to win the Game of Life?

Build Personal Character

Consider the case of Mike, a man in his 50s from South Africa who happened to vacation at a resort where he was surprised to find his high school track team having a reunion. When Mike was in high school, he had tried out for the team but hadn’t been quick or strong enough to be chosen for the elite team. At the time, Mike bemoaned his failure. In the high school scene, the team members were admired for their athleticism as well as their energetic partying and substance use.

When Mike ran into his former high-school peers at their reunion, he was struck by how the tables had turned. Although never an elite athlete, he had maintained a modest running and fitness program over the years and had avoided excessive alcohol, smoking, and drugs. At the resort, he found his former classmates looking and acting like much older men, some with oxygen tubes, some in wheelchairs, some dealing with obesity, diabetes, lung problems, and other effects of heavy living. He said that their kind of partying didn’t look so appealing anymore.

This true story is only one moralistic anecdote, but the point is that building character is more important than any other success. Slow and steady habits that enhance physical and mental health pay off in the long run of the Game of Life.

One House, One Spouse

Why not invest in some “marriage insurance?” Auto insurance would reimburse the cost of an auto accident. Home insurance would reimburse the cost of property damage. How can we “buy” marriage insurance that could reimburse the financial and emotional costs of a failed marriage?

Many financial planners have written about the significant effect that a spouse has on financial stability and freedom. In fact, many people recognize the phrase “One House/One Spouse” popularized by, among others, the authors of The Millionaire Next Door. Choosing a life partner who has the ability and commitment to live within his/her means is as important as being that kind of person yourself.

From a financial perspective, it’s worth doing everything you can to choose a partner wisely and then invest in maintaining the relationship. As one financial writer penned, “Whatever expense may be required to maintain your marriage should be considered as pennies compared to the cost of divorce.”

Ask yourself if you are investing as much in your marriage as you do in your health insurance? Or your car insurance? Are you investing as regularly and as dearly in your marriage as you do to insure your house?

In other words, time with your spouse (when you could be working or indulging) seems expensive, but it’s cheap compared to divorce. Vacationing with your family when colleagues seem to be pulling ahead at work might cost a pay raise, but it is cheap compared to divorce. Sacrificing in the short-term to cherish your spouse is worth the investment.

Couples counseling is covered by many insurance programs, but it might appear too expensive if it isn’t covered by yours. Multiple sessions of private counseling can easily run into thousands of dollars. According to relationship and marriage expert, Dr. John Gottman, most couples put off counseling for approximately 6 years past the point when intervention would have been most effective, making problems thornier. Despite all the obstacles, salvaging a long-term marriage, if it’s salvageable, is still cheaper than divorce.

Choose Your Own Kind of Hard

It’s hard to live within your means, and it’s hard to be in debt. Choose your own kind of hard.

It’s hard to solve problems that have become entrenched in a long-term marriage; it’s hard to get divorced. Choose your own kind of hard.

It’s hard to live an active lifestyle and eat a healthy diet; it’s hard to be sedentary or obese. Choose your own kind of hard.

It’s hard to fear what others think; it’s hard to be authentic. Choose your own kind of hard.

It’s hard to apologize; it’s hard to go it alone. Choose your own kind of hard.

The Ultimate Guide to Success

The tick, tick, tick of the Game of Life spinner is less relentless than the ticking of time. Millennials are at the beginning of lives full of many ups and downs, unexpected twists and turns. So what’s the trick to coming out feeling like a personal winner, financial and otherwise?
Build your character. Build your relationships. Build your stamina for doing hard things.

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