Broker Check


June 29, 2018

Our clients and the people who read this blog, know the importance of investing in a globally diversified portfolio of stocks, bonds, and real estate in order to reach their long-term goals. However, according to a recent Gallup Poll from May 4, 2018, the average American remains skeptical of the stock market.

The leeriest are adults younger than age 35. Before 2008, 52% of those aged 18-35 had money in the stock market. The current number for 2017 and 2018 stands at 37%. This shows the effect the Great Recession had on younger investors. Even a decade later, they still lack confidence in the market.

Another reason for younger investors shying away from the stock market is an inadequate financial education and low financial literacy. A 2016 report prepared by the Financial Industry Regulatory Authority tested respondents financial knowledge through a series of 5 questions covering fundamental concepts of economics and finance that may be encountered in everyday life. They found that only 37% of Americans could answer 4 or more correct. Clearly, there is more work that needs to be done.

So what can you do?

  1. Educate yourself – Read books on investing! One of my favorites is Paul Merriman’s “Financial Fitness Forever.”
  2. Make sure to teach your children about finances and the huge advantage they have when starting early.
  3. Consult a Professional – A fee-based, independent & objective advisor is a good resource to clarify the information and help apply it to your unique situations.