How Gen Y Financial Planners Win Over Clients

These twenty-somethings planners stress the importance of thinking about retirement now.

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Twenty-somethings aren’t known for their financial prowess. In fact, they have a reputation for over-spending, racking up debt, and being pretty clueless when it comes to money. But as more members of this young generation enter the field of financial planning and are tasked with providing top-notch money advice to clients, they’re forced to prove themselves as savvy professionals.

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Financial planners and advisors, in fact, occupy one of the fastest growing fields, with the Labor Department projecting a growth rate of more than 30 percent between 2008 and 2018. We tracked down a couple twenty-somethings work currently work in financial planning and asked them to share some of their best strategies. Here’s what they had to say:

What types of money advice do you give your peers?

Casey Weade, 25, vice president of Howard Bailey Financial and a certified financial planner: I talk to them about 401(k)s and making sure you understand your retirement plan at work. Many don’t even know if they have one or what the vesting schedule is. What they need to do is sit down, read the summary plan description, and if they don’t understand, talk to the HR director. I don’t know a single peer with pension plan access, so they don’t have the benefits our parents had.

Danny Tobias, 29, who is studying to become a certified financial planner and is co-creator of the budgeting site doughhound.com: As a group, twenty-somethings are not planning enough. Even if we’re not looking towards children or a house, these things are probably not too far away. Padding savings accounts now is very important. Investments for retirement can only come after day-to-day obligations are handled, whether it’s a mortgage payment or pediatrician’s bills. Once we handle those big bills, then it’s time to move on to the long-term planning. We can put money into retirement plans and invest it fairly aggressively with market index funds.

What about advice on handling student loan debt?

Tobias: Pay down those high-interest rate student loans as fast as you can and consolidate the rest. If you can get your loan rates to a comfortable level, it doesn’t make sense to pay them off early. Instead, put that money toward your other savings goals.

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Do your clients ever bring up your age?

Weade: Sometimes they bring it up, but I was a finance major and my dad has been training me since I was in grade school. I’ve picked my own stocks out since middle school.

What’s your top money tip that you also follow yourself?

Weade: Since my senior year of college, I’ve made a budget and tracked my spending. I use iBank.com. I really enjoy it. You can build your own budget. You can upload it into a spreadsheet and then can save for something big.

Do you find many twenty-somethings who want to work with a financial planner?

Weade: I think it’s rare. Not too many twenty-somethings have enough money to work with a financial planner. The only reason friends come to me is because I won’t charge them.

Kimberly Palmer (@alphaconsumer) is the author of the book Generation Earn: The Young Professional's Guide to Spending, Investing, and Giving Back.