Why Millennials Should Start Investing Now – Even If You Think You Can’t Afford It
And how to use money as a spiritual tool to help you become more awakened.
If you’re serious about creating wealth, you have to invest. When integrated into a robust monthly budget, there’s no better way for millennials to accumulate wealth. This leads to my question… Are you investing yet, or are you planning to build your portfolio once you’re earning more money?
If you’re in the latter camp, you’re not alone. Most millennials we speak to tell us they want to start investing, but don’t currently have the available cash. Recent studies support this trend. According to Australia’s largest survey of millennials “More than 25 per cent of Millennials currently live pay-cheque to pay-cheque, but it’s Millennials over 30 who have the least disposable income of all.”
But what if you don’t need a lot of disposable income to start building your portfolio. What if you could begin investing today – even if you’re in debt? Truth is you don’t need $1000s to make investing worthwhile. Instead, it’s worth starting today – even if you can afford just $100 a month. Keep reading, and I’ll show you how.
1. Leverage your most significant advantage [while you still can]
When it comes to building wealth, as a millennial, you have a considerable advantage – your age. Trust me; it’s a much bigger advantage than you think – if you start using it now.
When you’re young, it’s easy to delay investing – especially if you’re clueless about financial markets and you’re wary of getting it wrong. You tell yourself this is something you can do later. You convince yourself you can afford to wait until you earn more money or until you’re in a better position financially. This delay is a mistake.
Money doesn’t work in the same linear way as a human timeline. Instead, wealth grows exponentially because of compound interest. In short, the longer your money is invested, the bigger your pot becomes. Or to put it another way, the sooner you start, the less cash you need to build the same pot as someone who started later.
Start investing now, and you’ll create a financial habit that can bring prosperity and security in the future [as well as peace of mind in the present.]
2. Use the opportunity to overhaul your money mindset
Living paycheck to paycheck isn’t a sustainable wealth-creating strategy. If there’s no money left at the end of the month, you can’t move forward financially. Instead, you’ll stay in the same position. Worst still, you create no financial security either, which creates underlying stress and anxiety.
It’s easy to say you have no money to invest, but is that true?
In our consumer-driven world, plenty of so-called ‘needs’ are actually wants. You can blame this mindset for those expensive spontaneous purchases and needlessly large credit card bills! But change your behaviours, and you can transform your cash flow. For example, if you quit your card and spend intentionally, you’ll free up surplus cash.
The secret to wealth building is insanely simple. All you’ve got to do is:
- Spend less than you earn
- Invest regularly
- Know why you’re investing [so you stick to your plan long-term]
- Automate your monthly payments, so you don’t miss a beat
We help our members achieve this outcome during their Intentional Living and Values session. During this strategy session, members dive deep into their spending habits and behaviours. They get clear on what they want from their life and translate those desires into their monthly budget.
This budget-setting approach changes the game. It empowers you to live within your means, transform your relationship with money, and free up the cash you need for everything from investing to travelling. When you have a budget for investing, it quickly becomes a habit – and your wealth builds as a result.
[Want a conversation like this? Get a free taster with your Intentional Living Strategy Call.]
3. Start small and still accumulate big
You don’t need a huge budget to make investing worthwhile. If you’re in your 20s and 30s, you can start from as little as $100 a month and still accumulate a decent chunk over time. Remember, investment is a long-term strategy; not a get rich quick scheme!
And if you’re clueless about investments, you’re not alone. The financial industry has made investing intentionally complicated. With a treasure trove of funds to choose from, overwhelm is inevitable [which helps justify management fees loaded on by lots of companies!]
Good news! There’s an easy way to cut through the chaos and confusion. Invest in an Index Fund and reinvest your dividend payments. In simple terms, an Index Fund is an investment that tracks a financial index such as the ASX200. Index Funds ‘bet’ that the economy will continue to grow, and financial markets will continue to perform as they have in the past. There’s no need to know which stocks to buy with an Index Fund. You don’t have to know when to get in or out either. What’s more, because these funds track a particular group of businesses, if one company underperforms, it falls out of the index only to be replaced by a higher-performing one.
Need more convincing? This is what Warren Buffett recently told CNBC, “he’s instructed the trustee in charge of his estate to invest 90 percent of his money into the S&P 500 for his wife after he dies.”
Yep, investing can be this simple! And I get it if this simplicity doesn’t feel comfortable. We’ve been programmed to believe that investing is a highly complex, super complicated process, but it needn’t be. You can pick the most straightforward route and still win big. We have members who are now millionaires who started with $100 monthly investments.
So start small, learn as you invest, and pick a low-risk plan that builds over time. Most importantly, commit long term. Once you’ve got a fund going, keep it growing with your automated monthly payments. Get into the habit of reviewing your cash flow at bonus time or when your circumstances change, and your $100 start point could quickly steam ball.
4. Start investing today – even if you’re in debt
Don’t let debt put you off investing. In fact, would you be surprised to know that an investment strategy can help you become debt-free? Debt has a psychological impact as well as a financial one. As strange as it sounds, you can get comfortable and feel secure around debt. Your conscious mind won’t admit this, but your subconscious will feel it. When you’re comfortable with debt, it’s harder to become debt-free, because above zero is out of your comfort zone!
An investment strategy will change your money mindset and shift your psychological connection to debt. Over time your investment figure could even exceed your debt, transforming your financial position.
Ready to start your investment strategy?
If you’re a millennial, don’t waste this chance to leverage your age. Remember, the sooner you start investing, the wealthier you can become. It’s what we help our members do.
If you’re ready to build your wealth through an intentional relationship with your money, book your free strategy call. Chat with one of our coaches and discover how you can transform your financial situation and start investing today.
Disclaimer: All information contained within this article is of a general nature. Do not rely upon it when making financial decisions. Please consult a professional financial advisor or planner (like us!) before acting.