A Message for Millennials: Don’t Give Up Hope!

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Planning Your Financial Future Can Start Now

Discussions surrounding young adults’ prospects for retirement are trending in recent news. Young professionals have gathered online to communally air their current financial grievances and the dismal outlook they share towards their financial futures. According to these online discussions, many young professionals feel a sense of hopelessness towards their financial futures and believe saving for retirement to be impossible. Many individuals in their 20’s and 30’s have shared their concerns via the hashtag #millennialretirementplans. They say the immediacy of other financially related concerns such as rent, student loans and health care outweigh the importance of planning for retirement.

We say, “Don’t give up hope!” For anyone who finds it hard to envision a retirement, it is important to rethink financial possibilities and understand that small efforts made today can truly pay off in the long-term.


We recently sat down with several young clients who needed help deciding the smartest ways to improve their financial futures. One of the challenges young people face is deciding the best ways to use their extra cash to save, invest, and pay down debts. Below is a summary of the goals that we believe should be priorities in order to get on the right path towards having financial security later in life.

millenial financial planning
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Priority Goals

  • Paying Credit Card Balances– Beyond retirement savings, paying off credit card balances is one of the most important priorities.  The average interest rate for credit cards is around 15%.  Paying off credit card balances will bring a “return” in the form of interest expense savings.  It would be difficult (if not impossible) to find a more certain return on investment.
  • Saving for Retirement – At a minimum, we recommend that our young clients take full advantage of any 401k matching provided by their employer.  While it is important to save as much as possible, we suggest aiming for 12-16% of their salary; if that seems impossible, any amount contributed when there is a matching program, is better than nothing.  You can see the current retirement account contribution limits here
  • Creating an Emergency Reserve– It is important to have money available to cover unexpected expenses.  We typically advise our clients to have 3-6 months of living expenses tucked away in a savings account to handle financial emergencies when they arise.  However, if this goal seems unattainable, work towards having 2-4 months of living expenses set aside for emergency needs.
  •  Paying off Student Loans – It is common that our young clients have multiple student loans with relatively high interest rates.  We typically advise that they consider consolidating and refinancing their loans.  They can often do this at a lower interest rate.  This will make paying them off simpler and will establish a schedule for paying them off entirely.

As with any financial decision, you will want to consider your personal circumstances and preferences when determining your priorities.  The most important thing is to use any extra cash flow productively, rather than finding new ways to spend.  Don’t be overwhelmed by the amount of financial obligations you may have;  simple efforts beginning now will greatly help later down the road and retirement can quickly become a more conceivable reality. If you’d like help balancing your financial priorities, we would be happy to schedule a meeting or a conference call at your convenience.


Horizon Wealth Advisors is a Houston based fee-only wealth management firm. Horizon is a fiduciary advisor. We specialize in helping successful individuals and families understand, organize, and manage their often complex financial situations. Horizon offers integrated financial planning and investment management services.

Larry Maddox, CFP®, CPA
Larry founded Horizon Advisors, LLC in Houston, Texas in 1999 with fellow business partner Joe Thomson. He collaborates with our wealth management team and other external advisors to provide comprehensive wealth management services.

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