By Jeff Headrick, Financial Planner
April 5th, 2019
Millennials Really Do Have Their Act Together
Having met with hundreds of families and having had thousands of conversations with people about money, I have learned some things.
I have learned to listen. I have learned to read an individual’s body language and look into their eyes for something they may not be able to convey verbally. It’s what financial advisors do for a living. We listen, we have discussions, we educate, we motivate and then we activate. There’s an art and a science to helping people financially, and I’m not saying that I have mastered it yet. But I’d like to think that I’ve learned a few things over the years.
That being said, I have come to the conclusion that Millennials are going to be the best financial stewards since the Greatest Generation.
Dave Ramsey SmartVestor Pro
A couple years ago I became affiliated with Dave Ramsey’s SmartVestor program. Similar to his ELP program, the SmartVestor program is designed to bring Dave Ramsey’s listeners in connection with licensed financial professionals who can serve their best interest. The financial professionals and Dave Ramsey’s listeners tend to have a lot in common. They believe in Dave Ramsey’s philosophies for the most part, follow Christ, and strive to be the best stewards that they can be.
Not long after my affiliation with Dave Ramsey, I was offered an invitation to visit his offices and meet with the man himself. I had listened to Dave and read his books for over 20 years, so as you can imagine I was pretty excited about the opportunity.
My Visit to Dave Ramsey’s Office
When I pulled up to Ramsey Solutions in Brentwood Tennessee, I was surprised about some things. As I pulled up in the parking lot, I noticed several young men in their mid-20s coming out of this large facility with croquet equipment. I did not know anyone still played croquet! But then again, what do I know about today’s Millennials?
As I proceeded to my parking space, I saw these young men setting up their game during their lunch break on a small patch of lawn connected to the parking lot. Cool, I thought. Good for them. And good for Dave to have a loose atmosphere where men can be men and boys can be boys. Sometimes that collision can be a good thing.
Must Be That Millennial Vibe
As I made my way from the car to the front entrance, I noticed some more young men and women going to lunch. One of them was getting out of the elevator and carrying a very long skateboard with him. I guess instead of walking around the block during a lunch break for cardio, this guy was going to get his cardio via skateboard. Again, pretty cool. As a creative spirit myself, I like to work very hard, but I like to be myself and relax as often as possible to maintain that creative spirit.
I share this with you because what surprised me most about Dave’s office was not the efficiency that it ran with (it ran with a lot). It was not the high-level of professionalism and integrity of the people that I met (they were impressive). It was not even the wonderful opportunity to meet the Moses of modern-day finance. What surprised me most about my visit was the laid-back cultural vibe, propagated at least in part, because Millennials know how to have fun and some companies out there like Dave Ramsey Solutions have learned that they are wise to let them have it (think Google). They’ll get plenty of work out of them when their break is over.
Millennial Financial Mindset Vs. The Greatest Generation, Boomers, and Gen X
Over the last many years, I have met with a wide range of people. There was a time from about 2000 to 2005 where the vast majority of my clients were the Greatest Generation. This generation grew up during the Great Depression, and I have found them for the most part to be extraordinary clients. If you grew up during the Great Depression your understanding of the value of money was deeper than anything that they could have taught you in school.
As my client base grew, I began to serve more and more Baby Boomers. Baby Boomers are fantastic clients as well, but they have a different psychological makeup than their parents. They are a little bit more well read, and a lot more open to new things.
The Dow rose 346% and the Nasdaq rose 847% during the 1990s.
Source: Yahoo Finance. Chart and graph for illustrative purposes only.
I have also served a lot of Gen X clients over the years. While this is my generation, I have to be honest and say that compared to the two groups mentioned above Gen X are probably the least frugal. Having grown up during the wild 80s, followed up by the ten years of economic bliss in the 90s— a lot of Gen Xers believe ourselves to be bulletproof.
Time and circumstance will let us all know, sooner or later, that we’re not.
Of course, I have seen people from the Greatest Generation on occasion be the antithesis of their peers. Likewise, for Boomers and Gen Xers.
But we are all students. We are all learning. We are all growing.
6 Characteristics That
May Make Millennials Rich
Over the years I’ve developed great relationships with prospects turned clients that were approachable and coachable. When individuals have a friendly spirit, they are usually easier to work with. And from a teaching perspective, they are the most coachable. Teaching an individual or a couple about asset allocation, risk management, mutual funds, cash flow management, tax laws regarding rollovers, etc.— requires a congenial and teachable spirit. These are not easy topics to educate people in. I have found that Millennials have a quicker start out of the gate when it comes to financial planning due to their friendly spirit-- from the moment they walk in the door.
I have found most Millennials to be very honest. They don’t hem and haw about why it’s not really their fault that they are not reaching their goals. Maybe it’s because they’ve been listening to so much Dave Ramsey, but the Millennials I meet come to their initial consultation with an incredibly honest and open spirit. For a financial planner with a teacher’s heart, this is golden. How can a doctor, a financial planner, a pastor, or anyone else in our lives provide guidance if we are not being completely honest and open?
A great percentage of the Millennials I meet with are passionate about finance. More and more, I am hearing them request concerns for understanding the bigger picture, or holistic financial planning. This is a big pivot it from other demographics in that they can be primarily interested in the best mutual fund, or the lowest expense ratio on XYZ investment.
They want to be doing everything well. This includes cash flow management, debt management, estate planning, business planning, insurance planning, legacy planning and more. All of these topics just mentioned are not purely investment related. But they are central to your overall financial health. And I’m learning more and more that Millennials tend to buy into this holistic strategy lock, stock and barrel. Heck, they even motivate me with their passion! And that’s the symbiotic relationship that is beneficial in most any teaching environment.
And if one prevail against him, two shall withstand him; and a threestrand cord is not quickly broken. Ecc. 4:12
Having had a mailing address in Europe, the Caribbean, and many other wonderful places during my 20s, my daughter asked me once what was my favorite place in the world. I thought about it for a bit, and finally said: probably the library. Yes, I am weird. But I love books, peace and quiet, and a staff of intelligent people 30 steps away who can offer any assistance that I may need. All for free.
Today’s millennials love to read too. Some of them are reading Dave Ramsey’s books. Some of them are reading Chris Hogan, Rachel Cruze, or Robert Kiyosaki. But they are reading books on finance and gaining knowledge at a rapid pace.
Another wonderful quality that most Millennial couples have, is the quality of a unified spirit. I cannot express how difficult it is to explain new financial concepts and strategies to a couple that are at odds with one another financially. Most millennial couples that I meet not only think alike but act alike when it comes to money. I believe this might be one of the most unique differences between them and other demographics.
T.S. Eliot once said that to understand his poetry, you would have had to read every book he ever read in the order that he read it. I’ll let you ponder that for a moment. While we realize this is impossible to do, it sets the tone for understanding someone’s mindset. Millennial couples who study personal finance as a team, are generally very inspired and motivated to make positive change. The Bible tells us that the threestrand chord is not easily broken (Ecclesiastes 4:12). Having a unified spirit helps a Millennial marriage in more ways than one.
Some prospective clients I meet are incredibly humble, and others incredibly not. While an overconfident personality may help you in athletics or even in the operating room, it will not serve you well in personal finance. While most Millennials I meet are highly intelligent, they seem to have a depth of humility of people many years their senior.
They are not afraid of what they do not know, and they do not pretend to know something that they do not. I have met a lot of millionaires over the years that entered their early 60s with a lack of humility, who gained a tremendous amount of it in the remaining seven years leading up to retirement. Even as a licensed financial advisor with years of experience, I know that this is a complex playing field in a game where the rules change more frequently than NFL football. I believe that humble people learn lessons sooner, and the humble may build more wealth because of it.
Listed above are six characteristics that I believe are going to make Millennials rich. If you have some of these characteristics mentioned above, I encourage you to continue to hone that character trait and make it even more viable. If there were areas that you read about that didn’t sound like you, maybe that’s something you can work on.
I believe that Millennials are going to be the best financial stewards since the Greatest Generation. I pray they do not prove me wrong. I don’t have a lot of statistical evidence to back me up yet, but history will tell the tale.
About the Author
Jeff Headrick is an independent financial planner and wealth manager with Inspire Financial Planning. When Jeff was still in his teens his father died unexpectedly. While his father was a hard worker and a good provider, he did not have the best financial plan in place when he died. This left his family at a tough financial crossroad. This personal experience, coupled with being inspired by Sir John Templeton, Warren Buffett, Dave Ramsey, and the laws of compound interest, prompted Jeff to enter the financial services industry in 1999. He has been helping people with their financial planning ever since.
Jeff lives in Wilmington, NC with his wife and two children. He spends most of his spare time just across the Intracoastal Waterway in Wrightsville Beach, enjoying the beauty of the NC Coast.
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