Money is a deeply personal topic, and although talking to a financial advisor can often alleviate some of the stress associated with finances, it can be difficult to admit we need help. The reality is often very different than we imagine, though. To start, you are not alone. It’s common for people to struggle with financial issues like paying down debt, saving up to buy a home or putting away for retirement, among other things. It’s a good start that millennials are more likely than other generations to share financial information with their friends — at 30 percent, compared to just nine percent of Boomers — but a little professional advice might be even better when it comes to accomplishing financial goals.
Reason 1: You still rely on your parents for financial support.
The reality: According to one recent study, 45 percent of early adults received financial support from their parents in the last year.
Why it matters: Many factors contribute to why it’s common for young adults to receive financial help from their parents. Although it may ultimately delay the process it takes to become financially independent, self-serving adults.
How an advisor can help: An advisor can help young people (hello, millennials and gen z!) map out a game plan for gaining full financial independence. This might include: learning how to budget based on income, paying off debt, and determining an affordable lifestyle. A specialist will also help you figure out how to contribute to a savings account while still taking on traditional expenses like utilities, food, and entertainment, among other things.
Reason 2: You are drowning in debt.
The reality: Approximately 81 percent of young adults in the U.S. have some form of debt for a combined total of over $1 trillion in debt.
Why it matters: Debt is a huge factor when it comes to moving forward with future financial plans. With large amounts of debt, it’s easy to spend the majority of your income paying it off (leaving no room for other financial goals). Thus, your debt-to-income ratio may cause correlating poor credit scores making it more difficult to gain access to useful financial products, like low-rate loans and better mortgages.
How an advisor can help: A financial advisor can walk you through a step-by-step plan to chip away at debt, while also helping you set up a system that allows you to start putting away other small savings for other goals.
Reason 3: You haven’t started saving for retirement, and aren’t sure how to get started.
The reality: Although 45 percent of millennials have a retirement savings account, only 33 percent are actively contributing to it, according to a recent survey.
Why it matters: When it comes to retirement, thanks to the beauty of compound interest, the earlier you can start saving, the more money you’ll be able to accrue over your lifetime. Your early years are a great time to start. For more on maximizing the benefits of your retirement account, click here.
How an advisor can help: Retirement savings can be a scary topic for even the wisest of people. A financial advisor can help demystify the process by providing some actual numbers to a retirement goal, as well as helping a person figure out how much they should be saving based on their income, with plans to increase those savings accordingly.
Reason 4: You don’t have an emergency fund.
The reality: According to one survey, just 40 percent of millennials could handle a $1,000 emergency with savings they already have.
Why it matters: Putting a little bit away every month into an emergency savings account is one of the best ways to avoid going deeper into debt, should the worst occur. Most specialists recommend being able to cover at least three to six months of your income.
How an advisor can help: With everything else millennials and gen z have to worry about — from student loans and credit card debt to climbing that corporate ladder — saving in an emergency fund can seem like a distant fantasy. A financial advisor can help you comb through your budget and put together a plan—based on your take-home salary—this will provide you with an emergency savings cushion and financial confidence.
Reason 5: Your finances keep you up at night.
The reality: Although money tends to be a big stressor for most people at some point in their lives, for millennials — and millennial women, in particular — that time is now. According to one survey, 52% of millennial women said money was their top source of daily stress.
Why it matters: Besides all the additional issues that stress can bring (it’s not good for your health, let’s just start there), burying your head in the sand when it comes to finances won’t make the problem go away, either.
How an advisor can help: Think of it this way: A financial advisor is there to be your guide, a wise specialist who can take your hand and help walk you through some of the more stressful financial factors in your life so that you can face them, fix them, and move on. That’s not saying it will be easy, but with an specialist to assure you that you’re making the best, educated moves, it can be easier.
If you’re feeling anxious about talking to a financial advisor, remember that these specialists offer guided strategies based on their experience and your specific needs — at the end of the day, how you decide to handle your money is up to you. It just never hurts to know that the specialists are ready to help when you need it. Plus, a financial advisor doesn’t have to cost a lot. Depending on your specific needs, most advisors can work with a limited budget. When you’re ready to start making the most of your money, a Santander Investment Services financial advisor is here to help.
Santander Bank does not provide financial, tax or legal advice and the information contained in this article does not constitute tax, legal or financial advice. Santander Bank does not make any claims, promises or guarantees about the accuracy, completeness, or adequacy of the information contained in this article. Readers should consult their own attorneys, financial consultant or other tax advisors regarding any financial strategies mentioned in this article. These materials are for informational purposes only and do not necessarily reflect the views or endorsement of Santander Bank.
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