What 5 Top Financial Advisors Wish They Knew as Young Investors (2024)

Learning how to invest is no easy task, but guidance from pros can make approaching the field somewhat easier. We asked five independent financial advisors from the Investopedia 100 Top Financial Advisors list to share what they wish they had known as young investors. Here is their advice for young people who are starting to invest or beginning their investment careers.

Prioritize Your Education

Many financial advisors recommend that young investors spend money on their professional growth and financial education. When you’re just starting out, certification courses, online training, and workshops can teach you critical financial skills and perspective. The knowledge you gain now will help you increase your income and become more financially capable in the future.

“I'd rather a young investor spend $2,000 on a course to learn how to negotiate their salary and their first five years of working than put that $2,000 into a Roth IRA,”Cody Garrett, CFP, a financial planner and educator at Measure Twice Financial, said.

For self-paced learning, books can be a valuable resource for people looking to start investing and budgeting. Before she chose to become a financial advisor, Marguerita Cheng, CFP, CRPC, RICP, CSRIC, founder and CEO of Blue Ocean Global Wealth, read as many personal finance books as she could in order to understand the profession and clarify how it aligned with her passions and interests.

Besides books, there are countless financial education resources available on the internet, such as podcasts, YouTube videos, blogs, and Facebook groups. Many of these virtual resources are free or affordable, and among the diverse mediums, you are bound to find a resource you find engaging. Here are some that Brandt and Garrett recommend:

• Stacking Benjamins podcast with hosts Joe Saul-Sehy and Josh Bannerman the "OG"
• ChooseFI podcast with hosts Jonathan Mendonsa & Brad Barrett
• Graham Stephan on YouTube

“It’s not your grandpa's financial content anymore,” Benjamin Brandt, CFP, president and founder of Capital City Wealth Management, said. “It's actually entertaining and you might watch it even if you're not hyper-interested in finance. There's just an embarrassment of riches when it comes to content.”

Seek Out Mentorship

There is no better resource than people who have been in your position and worked through the challenges. It’s not just okay to ask for help, it’s smart. By finding mentors and building a community of support, you can gain access to a wealth of knowledge and feel more confident in your investment and career decisions.

“I think a lot of people are scared to seek out mentors,”Thomas Kopelman, co-founder and lead financial planner of AllStreet Wealth, said. “Mentors don't just fall into your life and take you under their wing. You have to go after and get the mentor, whether that's adding value for them or picking them out and asking questions. You have to be the one willing to do the work.”

According to Garrett, anyone can start a mentor search by casting a wide net for experienced professionals in their field and reaching out to them to start a conversation, noting specific aspects of their careers you would like to emulate.

“I sent 100 direct messages to all the people that I highly respected within my industry,” Garrett said. “Only four out of the 100 responded, but those four became the most impactful mentors in my life.”

According toAmy Irvine, CFP, EA, founder and CEO of Rooted Planning Group, attending conferences and networking opportunities can also help you find experienced professionals. For example, the National Association of Personal Financial Advisors’ Women’s Initiative has been a valuable resource that helped her connect to like-minded people and learn from others’ experiences.

As Cheng clarified, you do not need to follow your mentor’s every recommendation, but a second, trustworthy opinion is precious, and especially when you are beginning to invest, you should be open to suggestions.

Contextualize Your Investments

As many financial advisors say, the way that you approach investing can be just as important as the investments themselves. By contextualizing investments within their lives and portfolios, investors can open themselves up to more financial options and make better-informed investment decisions.

According to Brandt, each investor has a unique situation, and beginner investors should be wary of heeding generalized advice.

“Investments are a tool that helps people get to their goal, but they are not the goal itself,” says Irvine. By this she means that beginner investors should ground themselves in the life outcomes of investing, such as buying a home or funding a comfortable retirement, not purely the financial ones, such as making a million bucks on the stock market.

Many young investors in their 20s and 30s focus on their investment choices, Garrett notes, instead of focusing on their greatest asset: time. His advice is to invest that time in trying to find ways to increase your income and invest in yourself instead of searching for the perfect investment.

Another skill that helps provide context, according to Cheng: thinking through the many possible outcomes of a decision. By being mentally prepared for whatever outcome may present itself, Cheng feels more confident in her decisions, regardless of their risk level.

“With my clients, I take the time to tell them that risk is everywhere, but investing and financial planning is about making informed decisions and being risk aware,” she says. “Being risk aware makes me better prepared so that I can take advantage of opportunities when they are presented to me.”

The Bottom Line

By investing in their financial education, seeking out mentorship from experienced professionals, and contextualizing their investments within their lives and portfolios, beginners to investing can acquire more skills, feel more secure in their choices, and make better-informed investment decisions.