Financial Well-Being Newsletter: What's up with Millennials and their Money?

Trailhead Planners LLC |


First, we have a wonderful article regarding the Power of Positive People. Though it may seem obvious, the individuals we surround ourselves deeply impact our overall well-being. Which begs the question, is my community positively or negatively affecting me?

Second, we have a couple of interesting survey results regarding Millennials and their money. One thing we believe is important to note is that Millennials aren't just 20-somethings anymore.  In fact, the oldest faction is nearing 40 years of age! In other words, millennials are no longer kids just starting out as many of them are established professionals firmly into their careers and financial lives. Ultimately, that's what makes some of these data points so concerning. Read on to learn more!



From the Web

The Power of Positive People - NYT

This is a wonderful piece from the New York Times. Though 'you are what you eat' may not be totally true (at least I hope not), it turns out the people we surround ourselves with have a profound affect on our overall well-being. In fact, our social networks can affect our weight, our eating and exercise habits, our level of anxiety and overall happiness!

Extrapolating a bit, we imagine this can be extended to our financial well-being, as well. Are you surrounded by individuals with healthy, proactive relationships with money, or by individuals who are constantly complaining about money, economics, or the markets? As the article points out, the behavioral and attitudinal leanings of our social circles have a profound effect on our own outcomes.

We were reminded of a quote from Charlie "Tremendous" Jones:

“You will be the same person in five years as you are today except for the people you meet and the books you read.

From the Financial News

Nearly 70% of Millennials Regret Buying Their Home - CNBC

According to a recent survey, nearly 70% of millennials who own a home have buyer's remorse when it comes to their home. The article notes three reasons why this might be the case:

  1. Overspent on downpayment
  2. Underestimated ongoing costs
  3. Settled for something that's not quite right.

We see numbers #1 and #2 often in our line of work. In particular, overspending on a downpayment was made easier by the record low interest rates of the last 3-5 years. Lured by the call of low ongoing mortgage costs, many homeowners bought more home than they could actually afford. This, combined with an underestimate of ongoing costs, can lead to many feeling house rich, but cash poor.

Almost 1 in 3 Millenials Prefers Cash to Long-Term Investments (And they aren't even getting interest!) - Bloomberg 

According to another recent survey, 1/3 of Millennials prefer cash or near-cash investments (like savings accounts or CD's) for long-term investments that they won't need for over ten years. Coming on the back of one of the most incredible and long-lasting bull markets in stock market history, this is quite surprising. Worse, the individuals surveyed weren't even getting a competitive return on their cash savings, settling for the below market returns on their checking account, for example, instead of shopping for higher rates elsewhere! This means that over the course of a decade, these 'investors' would have lost a great deal of purchasing power to the damaging effects of inflation!

We love a good emergency fund - like love, love, love it - but once established, we believe it's time to move up the risk chain toward long-term bonds, corporate bonds, and, of course, stocks for the purpose of not only keeping up with inflation, but to get a competitive return to boot!

Have a great week!