The millennial generation -- love them or hate them -- has and will continue to have a tremendous amount of spending power. But will millennials invest their money wisely?
I recently sat down with International financial advisor and CEO of binary trading platform , Gordon Malcolm to find out what kind of mistakes entrepreneurs typically make when it comes to investing.
The thing that stuck out to me about Malcolm was that he gave sound advice similar to what Tony Robbins says in Money: Master the Game. I knew right then that he was a credible source.
Here are a few of the things that Malcolm said that millennials (Gen Y) should avoid when it comes to investing:
1. Be careful with traditional investments that you don't understand.
Just because it is age old tradition to invest in mutual funds and the market, that might not be the best move for you. Real estate is always good, but, for many young entrepreneurs investing in your own business might be a better move.
"For someone at the other end of the spectrum that is older and not currently working or earning, those people would make more conservative decisions", added ," author of A Paperboy's Fable: The 11 Principles of Success. "If you are young and able to work, you can perhaps afford to be a little more aggressive."
Of course, there is a ton of traditional investment options that are good ideas, but avoid getting caught up in investing in things that you don't understand. "If you don't thoroughly under it, don't invest in it," said Malcolm.
2. Putting all your eggs in one basket.
You might think that you found a hot new investment, but the age old adage of "not putting all your eggs in one basket" is exactly what Malcolm told me. Malcolm said, "No matter how lucrative something might appear, looks can be deceiving."
And I think he is totally spot on. Why would you invest everything into any 1 investment? Even if something looks good, markets can turn around in no time on the drop of a dime. And in this fast-paced world with news changed every second, you never truly know what's going to happen next.
3. Not seeking professional help.
Above all else, a lot of millennials are in the do-it-yourself mindset when it comes to many things. And while that may be good for many other areas of your business, investing may not be one of them.
Think about it this way. If you haven't done your homework and don't thoroughly understand the markets, the sharks are going to eat you alive. In fact, many day traders make their living betting against everyone else.
It is advisable under all circumstances to have a professional help you with your investment decisions. Word of mouth is a great way to find a professional in your area, and Yelp is also a great tool. In fact, in Tony Robbin's book Money, he suggests making sure that whoever is advising you has your best interests first, not just their own pockets.
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