I don’t want to sound callous, but I’m probably going to. Pretty much anyone raised by a baby boomer is afflicted by America’s number one problem: participation medals!
Now you may be asking yourself...
At the moment, our culture is extremely polarized, but one unifying trait shared by folks under 40 is…ENTITLEMENT. Your parents probably told you that you can be anything you want to be and encouraged you to follow your passions. Heck, at some point in college you probably said to yourself, “I’m gonna grab the world by the tail and pull it down and put it in my pocket.” This seems fantastic on the surface. Unfortunately, a lack of competitive fervor has landed most millennials in a sad spot.
Now, people who are successful and in their so-called “dream job” generally have two things in common. First, they work extremely hard pursuing their goals. Second, they take risks. Ironically, neither of these traits are generally found in millennials.
A recent study by Bankrate.com has suggested that millennials are so risk averse that more than 1 in 3 choose savings accounts (earning little to no interest) as their long-term investment strategy. Beyond that, according to The Bureau of Labor the average worker holds 12 jobs between the ages of 18 and 31. TWELVE! Does that sound like grinding it out to you? It seems to me that people simply give up when jobs become difficult or goals seem unattainable. This is driven by the widely held belief that everyone is a winner.
I’m not here to preach about the definition of winning or how if you aren’t first, you’re last. Rather, I want to answer a fundamentally important question originally posed by the legendary motivational speaker, Matt Foley: “How can we get back on the right track?”
The answer to this question is actually simpler than one may think. Applying some common sense and discipline goes a long way in terms of financial stability and personal growth. According to some of the most brilliant minds in business, there are two steps that you must take in order to find a career that will bear fruit over the long-term:
Find out what you are really good at.
Work really hard at what you are really good at.
If you successfully execute steps 1 and 2, you may find yourself in a situation where you need to decide if you want to go out on your own or if you want to work for someone else. I will likely devote an entire future blog post to the topic of being your own boss, but a solid way to figure out if you can handle starting your own business is to assess how much risk you are willing to take. And keep in mind, 50% of small businesses fail in the first 5 years.
As success becomes more tangible, you should be willing to take risk in your investments. This doesn’t mean trading commodity futures in an empty industrial park in China; rather, you may need to invest your non-emergency savings in instruments that can provide returns that outperform inflation over the long-term.
Everyone has a different risk profile, but allowing inflation to erode your purchasing power is not a good investment strategy for anyone. Savings account interest rates have been lower than inflation for the better part of a decade. If you haven’t noticed that, it’s not too late to start paying attention.
Granted, money certainly does not define success for everyone, nor should it. However, real-world participation medals normally amount to living on a steady diet of government cheese and living in a van down by the river.
Required Disclosures:
1. Any opinions are those of the author and not necessarily those of Raymond James. All opinions are as of this date and are subject to change without notice.
2. Futures trading is speculative, leveraged, and involves substantial risks.