Early Starters- The Young Couple
Marc & Christine, Age 30
After a slow start, Marc and Christine finally secured jobs that pay well and have some potential. They are living in a little bit of a euphoric world right now. They seem to have plenty of money compared to where they were even a year ago. It's strange to them that they ended up with a credit card debt though – not sure how that happened.
They don’t want to find themselves behind and have been researching what the right way to go about planning for the long-term.
While searching online, they found a way to start investing and have been buying stocks here and there. At this point, their portfolio isn’t big, but they are already wondering if they are going in the right direction. Some of the stocks have experienced a down, and Marc is not too sure he likes those any more. Christine told him to be patient, but it just doesn’t seem right.
They are also swimming in their head about what is the right thing to do first, save for retirement, pay off student loans or buy a house? It seems to them that if they contribute to their 401(k), then they won’t be able to access that for a down payment. On top of that, they need a new car. They heard about leasing, but the last car they had they bought used – so that is all they knew. Which way should they go? Also, their benefits department have been on them about choosing what they want before the open enrollment ends.
To them, they need a trusted resource. They want someone to advise how to start saving for their eventual retirement. Up to now, their lifestyle has been hectic, but lately lucrative, so they are a little nervous about being told they must stop –they just want a second opinion.
When first meeting with them, we noted that they have a hard time imagining being retired and believe that the magic of time will help them get where they want. Some of their expectations weren’t realistic given some of the goals they had. While it is a lot of fun to think about vacation homes, educating kids, buying a house, travelling -their desire to “live it up now” might not match those goals.
The advice was to recognize that all dollars can’t be spent or invested. They needed to establish an emergency fund for that inevitable bump in the road. Other answers lied mostly in understanding the balance between living now or planning for later – the decision to march down both of those roads at the same time gave them financial confidence they have not felt until now. They had to deal with protection of where they are now, provide for the uncertainties, start a long term plan, and understand the differences between good debt and bad.