A Wiser Retirement®

271. How to Build Lasting Wealth in Your 20s and 30s: Tips for Financial Freedom

• Wiser Wealth Management • Episode 271

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What steps should you take in your 20s and 30s to build sustainable wealth? In this episode of A Wiser Retirement® Podcast, we break down the key financial habits that can pave the way for lifelong security. Young adults today face unique financial hurdles such as rising living costs, student loan debt, and credit cards. Tune in as we share practical strategies to overcome these challenges and set yourself up for long-term success.

Related Podcast Episodes:
- Ep 260: 10 Financial Habits That Lead to Long-Term Success
- Ep 224: Living in the Moment While Planning for the Future
- Ep 123: Estate Planning for Young Adults

Related YouTube Videos:
- What is Financial Planning?
- 6 Habits of Financially Successful People

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Building Lasting Wealth in Your 20s

Speaker 1

everything's expensive right now . It feels like cars rent , I mean . So it makes getting those extra dollars into the four , one K or whatever you have access to a little harder . Um , but you have to remember that it is really important and you could be missing out on large amounts of compounding over your career .

Speaker 2

Welcome to the wiserirement Podcast . Are you curious about how to build lasting wealth in your 20s and 30s ? I'm Casey Smith . Today I'm joined with William Metcalf , financial Planning Associate here at Wiser Wealth Management . We call him Mr Dependable and you didn't wear your cape today . Normally he has a superhero cape on because William saves the day with knowledge all the time . I feel like you're always just reading and studying . You probably were when you recently passed the CFP .

Speaker 1

I actually was . Yeah , I have my life back now , though .

Speaker 2

But , yeah , this is his podcast debut . Each week , we try to bring you practical advice on retirement , investing and planning for your financial future . Don't forget to subscribe to the podcast wherever you're listening . So let's get started . All right , william , I guess well , actually listeners and watchers this is a great episode to pass to your gang kids , your younger people in your family , or maybe you're a young person listening yourself . There are so many things about building lasting wealth that require you to really start early , or , if you start later , you got to have a really sizable event to help you do it right .

Speaker 2

So let's kind of start with a couple of small stats . I'll kind of prime us here for the conversation About 30% . Well , I see the average American has about 30% of their income going to service debt payments . So out of the gate that could be house , car credit cards , personal loans , all the stuff right .

Speaker 1

Buy now , pay later . Yeah , buy now , pay later stuff .

Speaker 2

Buy now , pay later stuff . Yeah , that 0% interest can get you . It's 0% interest . But unless it's a necessity , don't know if that's the best idea from a cash flow perspective . But 30% of income goes to cover just debt payments . It doesn't mean it's eliminating any debt , you're just getting rid of the payments . The other kind of staggering stat is 20% of Americans have over 50% of their revenue going to service debt . So 20% have 50% . That's crazy . Those are the people who aren't saving . There aren't wealth management clients Don't want to be those people necessarily . So you know , starting off , you know this will even more than I do now . But starting off , when you're young you have large apartment rents .

Speaker 2

Now it's hard to get away from it if you want to live in a safe environment . Yeah , so you do have a large chunk of your probably income at the beginning . That's going toward that , yeah , but it's . It's um , uh , you know , there there's some , there's some things that that be thinking about . Uh , when you're starting in , small , small things make big differences down the road .

Speaker 1

Yeah .

Speaker 2

So let's um , let's get started . You want to tell me why you think this topic is so important .

Speaker 1

Well , yeah , so for younger people especially . I remember there was a study I think it was last year , I saw it but Fidelity does a yearly study , kind of giving benchmark numbers , and if you peel back the layer on that , those stats that you just gave I think you would show that younger people are struggling with debt more than you know , people that have already been established in their careers and things like that . So , like Gen Z and younger millennials , especially they , they have a lot of credit card debt . They have a lot of the buy now , pay later . I mean . So it's for my generation , people that are just starting out coming out of college , it's it's a big issue . So I think people need help getting out of the gate on the right foot . Yeah , um , and so that's what we're going to talk about .

Speaker 2

You know , a lot of that probably starts with even just college loans . Yeah and and , but no one's really there to educate them in high school that , hey , maybe this college loan is not the best idea .

Speaker 2

Like you know I love , as you know , berry college and someone asked me one time should I go to KSU for free or should I go to Berry and I'll probably have about $30,000 in student loan debt ? And I'm like a KSU degree is way better than a Berry degree if it's debt-free . A Berry degree , I think , is better than a KSU degree , but not with debt attached .

Speaker 2

The same way for Georgia Tech , right ? I had the same question Berry College , georgia Tech . I said absolutely Georgia Tech because they have a stronger local network in Atlanta . You have to look at all these different things , but maybe going to a school debt-free is better than having these big loans , with some exceptions .

Speaker 1

Sean out here always loves to talk about how they compound daily , and there's not really any other loans that do that .

Speaker 2

That's right , um , so that's a that'll kill you they give you , they give you a low interest rate , and then they compound it daily . Yeah , that's pretty awful , honestly all right , so let's talk about the importance of starting early yeah .

Speaker 1

So I kind of broke this out into two uh , two different like uh topics . So you've got the sort of like the quantitative math side of things . So you've got the quantitative math side of things and you've got the setting habits , the qualitative side . So the math side is really on your side when you're early in your career , and that's because of compound interest , obviously . But when you start investing early , while you may not be investing large dollar amounts because you are just starting out , um , you do see way more compounding . So , for instance , at age 20 , $1 you invest with when you invest into low cost ETFs , you know , say you retire at age 65 , that would be worth $88 in retirement , you know . And then you can go down to age 30 . If you do that , $1 is then worth $23 at retirement . So you see how steep the decline is in the compounding Um yeah , by taking a decade right .

Speaker 1

If you go to age 40 , then it's drops down to just $7 , you know . And so those are things that can be offset by saving more . You know later in your career when you have more income to save , but it's still kind of staggering to see how much of a drop off that is so even if you're not maxing out your 401k , even you could just put in 10 percent of what you earn .

Speaker 2

Exactly that compounding would be worth way more than than adding more when you're 50 exactly exactly , I mean , it makes sense yeah it's hard to remember that in the heat of the moment right and it's hard to get you go car shopping , you're like , yeah , but this one's only sixty thousand dollars , or this one's , yeah yeah , makes a big difference yeah , and everything's expensive right now .

Speaker 1

it feels like cars rent mean , so it makes getting those extra dollars into the 401k or whatever you have access to a little harder , but you have to remember that it is really important and you could be missing out on large amounts of compounding over your career .

Speaker 3

Yeah .

Speaker 1

So the second thing there is the qualitative , and basically my point in bringing that up is just that things you start doing early are things that habits that you're building , that you're going to carry through your career , and I think that we see that with our clients , a lot of them that have built wealth over their career . They're people that save they saved , you know their whole career as best as they could , um , and that those smaller amounts when you're going really do add up later .

Speaker 2

So let's talk about the order of operation here . So what , what ? What should we be tackling first in our twenties and thirties ?

Speaker 1

Yeah . So I think a lot of people um don't necessarily have the best grasp of where their dollars are going , and so I think that's the first thing is just to understand where your cash flow is actually going .

Financial Strategies for Building Wealth

Speaker 1

So it's boring , Nobody likes to do it . I mean , some people like to do it , but a lot of people don't like to do it is make a budget , Even if it's Excel . I personally use YNAB , which is you need a budget . That's what that stands for .

Speaker 1

But there's like free tools out there . Mint's gone , unfortunately , but NerdWallet has a free software and there's others out there . But just having an understanding of where your money is going , I think is really important . You know , for younger people it seems like subscriptions and those types of expenses . There are things that you add , or you do it to get the free trial , and then it's there and it's charging you monthly , right . So cleaning that sort of stuff up is important and those are just small dollar amounts .

Speaker 1

But like when you do the math on I was doing this recently like the math on Spotify it's like I don't know if I'm really getting the value out of this , because I mean , if you , you know you look at how much you're paying per year over the next few years , it's like I don't know if I listen to enough music to justify that . But right , um , that's just one example , um , so yeah , basically , if you aren't using it , just cancel it . So that's a small way to kind of clean up where your money's going . Um , and it's something that was on my mind recently about other date , little things like .

Speaker 2

Um , you know , when we travel for for work , obviously that's an expense to me , uh , but when you go by yourself to travel somewhere , it's expensive to park at the airport . Now , yeah , I mean I , I now , I , I I have like the the gold parking , but but I feel bad because when I'm traveling other people , what am I going to do ? Make them go take the bus somewhere , right , so I just tell them to park wherever .

Speaker 2

But if you park an hourly parking for , like I don't know , it was like four days , three nights , four days or maybe it was two nights , I can't remember , but I had given someone else my pass and so I just parked in the hourly for like three days . It was like $300 something . She was like good grief , I mean that's fine , I mean I'll pay that , it's fine , but at the same time if you're just a normal person traveling , it's hundreds of dollars .

Speaker 1

Just going to the doctor in downtown Atlanta , like at Emory , the parking's like I don't know , $20 for like over five hours or whatever .

Speaker 2

If you had a friend take you to the airport , which I think is probably what was what I used to do a long time ago , right , either my parents or my wife would run me down there if she wasn't going with me , Right , that was you save . You save a lot of money , yeah , so it's just a little things like that , you know . I think it's important to add here , especially for married couples . Uh , there used to be a lot of fights in my house about money early on , and I would say the word budget and budget would spur like just angry rants and what I found was budget to me means , um , every dollar has a purpose , and budget to her means we have to cut everything out , and a budget doesn't mean you have to cut anything out .

Speaker 2

It just means that every dollar has its purpose . And as I've been more successful now in my late forties , uh , my , my budget is more of . Am I saving enough for my future ? Am I building this company uh to where it needs to be , uh , at my retirement ? Right , and , and so as long as I'm saving first , then everything else can kind of do whatever it does , right , right , and . So as long as I'm saving first , then everything else can kind of do whatever it does , right , right . But early on you do have to watch kind of everything more when you , when you're first getting started , Yep .

Speaker 1

So yeah , I tried the the pay yourself first strategy at first when I first got married , and that didn't really work that well . So we , we needed a little bit more structure .

Speaker 1

Yeah really more for my wife than me , just because she didn't quite under . You know , I have like an idea of something in my head , yeah , and it's like , okay , I actually need to communicate that and give kind of a you know what the expectations are and right , um , so we , we go through that once a month we're a credit credit card society right and now we use our phones to pay , mostly , like a lot of times I don't even have my credit card on me .

Speaker 2

It's just having to have my phone with me , uh , and , and that can rack up really fast . Uh , just what your teenagers have access . To credit cards , supposed to be for gas , only be at all . These other things keep popping up .

Speaker 1

Yeah .

Speaker 2

It's very expensive . Uh , in fact I put our oldest on a on a budget when he was a senior year . I said this is what you're spending on your credit card . I will not tell anybody what that number was . It was ridiculous . Some people don't make that money . And I start looking at it and I'm like what is he spending it on ? And it was gas and it was Chick-fil-A mostly . I would say 90% gas and Chick-fil-A . So when I cut the budget down , it was like a quarter of what he was actually spending . All of a sudden he started coming home for dinner right Going out with the friends . The Chick-fil-A was too expensive because he had to live within this boundary . So all of a sudden he started showing up for dinner every night . My wife's like why is he ? He's coming home for dinner now . I guess he misses us . He knows he's leaving soon . I no , that's not why I cut his budget in half from from endless , uh , bottomless Chick-fil-A to uh to probably maybe once or twice a week . Yeah , Um , but yeah , nothing .

Speaker 2

I'll say just just being the older guy here in this conversation is everything has a season . So you think that , oh , things are tight , or I'm not doing this like my friends are , because that's the worst thing is you start looking at what other people are doing . Uh , according to our stats , most people aren't responsible with money . Yeah , so you do have to live a little different . Maybe a little . It'll seem a little more frugal at first , uh , but in , in the long run , uh , you'll have a great quality life , but you have to sacrifice some things at the beginning . And in the long run , you'll have a great quality life , but you have to sacrifice some things at the beginning and in the meantime , your friends will just keep living within their payments and they'll always have payments .

Speaker 1

Right , and I mean , the other thing is too , like if you're making a decision , that's your lifestyle and you just have to understand what you're trading off for that , in my opinion . So if you're doing certain things that maybe cost a little more money , that's okay as long as you understand what you're costing your future self . Correct , so correct . Yeah , the other thing we always tell people is to eliminate high interest debt . Um , so that's relatively straightforward . You know , credit cards and personal loans and those sorts of things that are that are locked in at a higher rate are always something that we would want to tell people to get rid of .

Speaker 2

I would say if you're a young person , um you , especially if you don't have a family yet , you should have the ability to lock yourself down . You have to get rid of credit cards , and if you have a problem with credit cards , you need to cut them up and not use them . You could have a debit card . You don't do like the Dave Ramsey cash envelope thing . Chances you'd probably get stolen in Atlanta . But I I would say , if you think you have a credit card problem , um , you need to eliminate that card .

Speaker 1

It's just easy to get out of sync too and I've I've gone through this , uh , as a student or even , you know , right after I graduated but it's easy for , like , if you start putting everything on your credit card , it's out of sync with what's actually in your bank account . And it's not even that you're trying to overspend , it just kind of happens yeah .

Speaker 2

The trick for that is to pay it every Friday . Every Friday you look down and say okay , this is what I charged this week and you're going to pay it off every Friday . But if that still is a problem , then you get to move to cash just when the debit card runs out . They won't , the transaction won't go through . Yeah , yep , right .

Speaker 1

Yeah , so another thing that we typically recommend is for you to build an emergency reserve , um , so that's another kind of boring baseline thing . But when you have car trouble , like we you , you know , my wife and I had a few months ago , it's like you just got to pay it , I mean , and I didn't have to put it on a credit card because of that .

Speaker 2

so I met a lot of people in my younger years as an advisor that said their credit cards were their emergency reserve . I don't think that's a good idea .

Speaker 1

No not at 18 or 20% interest , like a lot of credit cards are right now .

Speaker 2

Right , you need to have something , even if you just start with . I don't know if $1,000 solves any problems these days . You probably need about $10,000 in there , but you can just start getting to $1,000 , then get it to $2,000 , get it to $3,000 . I know every time I have to call a plumber to my house it's going to be at least 1500 bucks .

Speaker 1

There are no more a hundred dollar problems , no no , and the general rule with that is if you , if you have dual income , then you would do try to save three months of expenses and then you know , if you are only on a single income , then you try to save up to six Yep . And you know something personally that I like to do is cover , make sure my insurance deductible is covered , you know . So if you have some sort of emergency then you've got that covered and you don't have to worry about medical debt , because in America I think that's the top reason for bankruptcy actually is medical debt , medical debt yeah , Not have enough medical insurance .

Speaker 2

Yep , Now , one thing that as we , as you run down this list here , I'll add right in here , is a house , so a lot of people want to buy real estate . Real estate's very expensive right now for starter homes and it , you know it's um , you can . You can just keep adding that to your emergency fund .

Speaker 1

Yeah .

Speaker 2

So just keep building out your emergency fund and that could be go towards your down payment toward a home . But I would certainly get rid of your debt before you buy a house .

Speaker 1

I think that's really important .

Speaker 2

I think student loans should be gone before you buy a house . I think you should get rid of . Get rid of credit card debt for sure . And that'll just help you qualify better for the home Right for the home Right .

Speaker 4

Are you curious why annuities keep coming up as a potential investment option ? People are often told that annuities can effectively mitigate investment risks and help secure their financial future . However , annuities often benefit the salesperson and might not be the best choice for you as a consumer . To learn more about the various types of annuities , the negatives of owning them and better investment alternatives , we have a free ebook on our website just for you To download our ebook . Buyer , beware , why Do they Keep Trying to Sell you that Annuity ? Simply click the link in the episode notes or visit wiserinvestorcom slash guides . Now let's get back to the episode .

Speaker 2

So let's talk about , you said , building an emergency reserve . Let's go on to retirement savings .

Speaker 1

Yeah , so I can kind of bundle this with I mean , we kind of have it in the next section here but retirement savings , obviously . So , while you're young , that's not something that you're necessarily wanting to think about , maybe , or is top of mind for you , and it's definitely not the most pressing issue that you have financially . Like we've already talked about , if you're trying to save for a house or you're trying to , you know , just make ends meet , it's not the thing that you necessarily want to think about . But , as we've already discussed , the compounding is is very hard to . When you see those numbers , it's very hard to uh forego that . So , even if you're just putting a little bit into your , you know if you've got a Roth IRA or an IRA or , uh , you know your employer has a 401k or something like that .

Speaker 2

Um , just putting something aside , yeah , and many companies have 401ks . That matches now right , exactly .

Speaker 1

Yeah , so that's that's something that you definitely don't want to leave on the table . It's you know , most people call it free money as an employer match , but really it's part of your compensation package , so that's something that you really should be taking advantage of .

Investment Strategies for Young Adults

Speaker 2

So let's start with investing in our 20s and 30s .

Speaker 1

Yeah , so I guess , understanding the basics of you know , typically we would recommend ETFs for investing in index funds . We're not big on active trading or anything like that and being diversified is really important .

Speaker 2

I feel like your people your age they're either they have Coinbase accounts and they have accounts that really focus on single stocks .

Speaker 1

What do you think the draw ?

Speaker 2

is there versus the ETFs ?

Speaker 1

That's the social media effect , because there's a lot of . I mean , if you screenshot certain things , that's the big thing is , you know , people share their screenshots of their winners and that's alluring , and I honestly think a lot of that has to do with people having a tough time making ends meet because they're trying to , you know , pick that winner . That's going to go up , you know , like you know , picking Bitcoin in 2009 or whatever , right , but I think that's driven by some of the other things we just talked about , with finances being a little harder to make meat for younger people . But I , and like Robin hood , we wouldn't recommend you being on Robin hood as a trading platform . Um , that's , I think that's what you're referencing , but , um , it's just not . It's not a good way to divert , diversify your risk or , you know , mitigate or mitigate that , and to save for retirement or really anything .

Speaker 2

It's almost like Robin has turned investing into gaming somewhat and literally showing you real-time balances . Right , you look at your account it's moving up and down , up and down , up and down .

Speaker 1

Yeah .

Speaker 2

That's the gamification of investing .

Speaker 1

Exactly .

Speaker 2

That's not what successful investors do . That's not what Warren Buffett does . That's not you know . S&p 500 is really not going to let you down . Yeah , and you'll see outsized returns just by investing in that index . When you think about , you know , retirement accounts we talked about 401ks . Do you feel like most of the people your age are investing in 401ks , or do you think they just think it's for old people ?

Speaker 1

Well , my friends are probably a little different , that's true , all your friends are .

Speaker 2

I have a lot of financial planning .

Speaker 3

Friends from .

Speaker 1

UGA , but I think most people my age are investing in some kind of 401k . Even my non-financially minded friends are doing something because their employer provides it .

Speaker 2

I think I mean most employers provide a 401k these days , and if you don't , you could always open up a Roth , exactly .

Speaker 1

Yeah . So I mean , while you're young and you're just starting out , saving in a Roth IRA can be a really good idea . We've done other videos on the trade-offs of that , if you're interested . But while you're young and your earnings are low , then that's a good place to save .

Speaker 2

So when you think about young people you have so much time we talked about compounding really helps . Why do you think so many are trying to time the market like ins and outs ?

Speaker 1

Yeah , I think it's think , it's not just young people , everybody knows that . But yeah , but I think it is more prevalent with Gen Z . Just based on my friends , or you know , people that I know um , I think that a lot of it has to do with not investing for the long term . They're more short term minded and they're just trying to invest to , you know , maybe , I don't know buy a car , increase their lifestyle . I think that's kind of what they're trying to do .

Speaker 2

And I mean , there are people that they treat it like a side hustle .

Speaker 1

Yeah , and there's a lot of influencers out there that you know . Maybe they got in early on crypto or some sort of uh you know Bitcoin or some sort of cryptocurrency , and so that it's when people see that they try to emulate that . Um , so I think that's a lot of it .

Speaker 2

Slow and steady wins the race . Yep , uh , what are some mindsets or habits that you think people should have for long-term financial success ?

Speaker 1

I think finding good resources and trying to learn is important .

Speaker 1

It doesn't mean that has to be your main focus , you know , outside of your work , but I think just becoming literate and understanding kind of the tried and true methods to building wealth whether that's reading books or , you know , listening to podcasts or , you know , just doing some research from reputable places I think that's huge .

Speaker 1

Just doing some research from reputable places , I think that's huge . I also think making sure , while you're in your early 20s , in your 20s period , you make sure you're learning or you're earning that's what me and my friends always say . So , if you're in a job that you're not satisfied in , you need to be learning because you need to be building your skills or doing something that enables you to , uh , expand your or increase your income or , you know , allow you to do something that you actually enjoy . Um , so I mean , you know , like , for just the personal examples , like I just passed my CFP exam , that was not easy , but that was something where , you know , I have an employer that's , you know , helping me to achieve that mark and , um , you know it , it opens a lot of doors .

Speaker 1

Um , so it's a , it's a , it's a great way to , uh , you know , build yourself in a profession , so that's , that's what I'm really getting at when I say that , yeah , so , yeah so , learning and earning , um , but yeah so that's an important one while you're in your twenties , cause that really is setting the trajectory for you for a long time .

Speaker 2

Uh , what do you think is some pitfalls for young people ?

Speaker 1

Well , yeah , saving too much while you're . I actually know some people that are in my age group and I'm 25 and they're saving too much in my opinion , and I think that's really not the best way to live your 20s and early 30s , you know , and there's there's other ways to Other things you may want to spend money on . I mean , just go live your life a little bit . So there is that aspect as well . It's like you don't want to be the miser . That's that's just like saving , you know , 40% of your income or something like that . You want to go , you know , hang out with your friends and , you know , go on a trip now and again and spend time with people .

Speaker 1

So I think that's really important to remember as well , not to get fixated on that , and I know that some people have a tendency to do that .

Financial Habits for Young Adults

Speaker 1

Um , and that kind of on the opposite spectrum is , uh , kind of discounting the future , and that's there's a term called hyperbolic discounting , and basically that's like our inclination to choose things that we can kind of , uh , that are more tangible to us now , instead of saving for the future . Uh , cause , you know it's it's something that we can visualize and understand , where it's like saving and getting that you know . $1 to $88 return on your savings is not that tangible to somebody my age .

Speaker 2

That all makes sense . Uh , I would say in addition um , as far as habits , just make sure you and your spouse are on the same page . So , communication is really important . Yeah Uh , divorce is really usually centered around finances in some way because the finances can be stressors .

Speaker 2

So just be in it together and work on it together and have common goals . We see so many people that come through here that make even good money and they kind of silo everything away as his and hers and I'm like , how long have you guys been married ? And they'll say 20 years . I'm like great , when's your money getting married Right ? And they kind of silo everything away as his and hers and I'm like how long have you guys been married ? And they'll say 20 years . I'm like great , when's your money getting married Right ?

Speaker 2

And they always kind of look at and laugh at me when I say that . But you know people , people pay me to tell the truth , so I'm not going to sugarcoat it . Yeah , sometimes after the fact I'm like , oh , matt , could have said that probably a little nicer yeah .

Speaker 1

Yeah , I mean that's true , even if I mean we have I know we have some people that keep things separate that they're on the same page , at least they know what each other are doing , and I think having the conversation is like the biggest thing . It's because if if you're just not talking about it at all , that's definitely not a good place to be at .

Speaker 2

Yeah , a lot of what we do is is quasi marriage counseling too , cause you , before you say things like that , you kind of have to get a sense of where the actual the marriage is . You know if , if one person's thinking about stepping out , then you would never say , let's put our money together . You definitely want your money to be separate at that point . So you do have to kind of read the room and and and let let them tell their story for a little while before you can give the right advice . Yeah , sorry , so let's , let's put this into some practical action steps . So what do we ? What do we do ?

Speaker 1

first , if you're listening to this , and I'm in my twenties and thirties , if only . Yeah , I would say take advantage of the low hanging fruit , and I think the like lowest hanging fruit . If you're an employer with a 401k plan that offers a match , you need to be taking advantage of that .

Speaker 1

That's part of what you've earned as as an employee and you need to be getting that . Um , so I think that's that's a big thing . That's also a way to increase your savings rate . So if you're , you know , you're putting in 3% to get the 3% match , you're kind of saving 6% of your salary . Yeah , so you know , it helps you save more and that's the goal of it . Um , so that's number one . Uh , I , if you're struggling with cashflow , I would not avoid it . I would , you know , make sure that you're actually mapping out where your finances and where your dollars are going . Um , and that's that's not the most fun thing to do . Um , but you have to be able to kind of rip the bandaid off and figure it out . Um , yeah , and if your employer doesn't offer a retirement account , I would highly recommend opening a Roth IRA at Schwab or Fidelity or somewhere like that .

Speaker 1

Um to just get the start getting money into a retirement account .

Speaker 2

Do you think people in their twenties and thirties need financial advisors ? That's a great question .

Speaker 1

Uh it , it depends on how complex the situation is . Most people like myself , I think as long as you're doing the bare minimum or you know the low hanging fruit kind of things , you know taking advantage of your employer benefits , you're saving for whatever your goals are Maybe it's buying a house , maybe you're having a child , you know , um , I would say probably not for most people . If you have a large inheritance or something and you're like I don't know what to do with this , then maybe , yeah , that would be the time to make that call . But I think for for most people , unless you're just highly intimidated by investing in an index fund , then , um , I would say probably not .

Speaker 2

I mean , I think , stay out of debt , eliminate debt as fast as possible , have an emergency reserve savings in place , save for your future and your retirement plan , and the extra you can build up in a separate account . We call that opportunity money . Yeah , and you'd probably be just fine at that point . I think higher wage earners might still need at least one time planning , because the tax component is very important . Do you put money into Roth ?

Speaker 1

Do you have stock options or something like that ? Yeah , exactly .

Speaker 2

We work with a lot of airline pilots that are in that 20 to 30 range , but things , things are different . Uh , there's , there's market-based cash balance plans and 18% of your money is going into your 401k plan and or the company money , uh , 18% of your salary , uh , so that that that's . There's a lot of moving parts . So one time plan kind of makes . Kind of makes sense there but I think yeah the for the normal civilians .

Speaker 2

Yes , I think , I think you are correct that just as long as you have the good , a good base , and you're building towards your future , um , I think that's the important part , and there's tons of books out there that help you , to help you yeah , that's true so , uh , all right , william , thank you , great job .

Speaker 2

Good research , cool , all right . So let's uh talk about some other episodes that you might find helpful . Episode 260 , 10 Financial Habits that Lead to Long-Term Success . Episode 224 , living the Moment While Planning for the Future . Episode 123 , that's a long time ago . What episode are we in today ? 272 today . Episode 123 , estate Planning for Young Adults . That's important . We should have thrown that in there . You definitely should have a will and medical directors and all that fun stuff . Power of attorneys yeah , that's big . We have a YouTube channel . It's called A Wiser Retirement . You can watch it . You can watch the podcast there . Our last podcast was getting a lot of views , actually , so I think more and more people are tuning into the uh a wiser retirement on YouTube . Uh , we're linking today to what is financial planning and then six habits of financially successful people . I think I did that one with Michaela . Uh , we have a link to uh , hyperbolic discounting , is that ?

Speaker 1

Yeah , that was just the link that explains what I was talking about earlier Discounting future gains for , like current gains now .

Speaker 2

Okay , anyway . So thanks for listening to today's episode . If you're interested in learning more about Wiser Wealth Management , you can schedule a consultation to meet with one of our fiduciary financial advisors . You can do so by going to wiserinvestorcom . Click on the episode notes below if you have any . If you want any follow-up , all right , thanks , william . Yeah you're welcome and thanks to you listeners . We'll see you guys next time .

Speaker 3

Thanks for listening to a Wiser Retirement Podcast . We hope you enjoyed today's episode . Make sure to subscribe wherever you're listening . That way you don't miss any new episodes . We'd also appreciate if you could leave a rating and review . If you have any questions about anything that was discussed today , head to wiserinvestorcom and reach out .

Speaker 3

This episode was produced by Rachel Dotson . This podcast is strictly for informational purposes only and is not to be considered as investment advice or solicitation to buy or sell any financial products , securities , digital assets or any other investment vehicles or a basis to make any financial decisions . Wiser Wealth Management Incorporated is a registered investor advisor with the SEC . The host and or guests may personally own securities , digital assets or other investment vehicles mentioned on this podcast . Neither the host nor guests of the show are compensated for their participation and no referral fees are paid to or received by any host or guest for clients , listeners or similar interests . Investments involve risk and , unless otherwise stated , are not guaranteed . Be sure to first consult with a qualified financial advisor , tax professional , insurance professional and or legal professional before implementing any strategy discussed herein . Past performance is not indicative of future performance .

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Casey Smith

Co-host
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Shawna Theriault, CFP®, CPA, CDFA®

Co-host