Young adults face financial complexities such as student loans, new mortgages, or car debt, coupled with low-paying entry-level jobs. With so much on their plate, those in their early twenties might feel overwhelmed by the words “saving,” “retirement,” or “investing.” If you’re in this situation, is it too early for you to start investing?

As soon as Nihar Suthar got his first job, as a tutor for his college’s athletics department, he started saving.
"I have been investing since last year, but have been saving money from the time I started college in 2012," says Suthar, who is now a consultant at the firm Roland Berger in Boston, helping clients figure out ways to cut costs or increase revenue. 
To date, his savings, which he keeps in a brokerage account, have grown to $109,000, thanks to money he earned doing odd jobs at school, stockpiling cash from internships and banking a $15,000 gift from his dad for graduating early from Cornell University. 
On the side, he writes inspirational books, netting him extra funds from royalty checks. 
“In addition, I've been taking advantage of my 401(k) and the employer match,” says Suthar, 21. “I have close to $10,000 in there so far.” 
Suthar, who has a degree in applied economics and management, doesn't like the idea of losing his hard-earned cash. So he takes a conservative approach, which to him means “putting a large amount of money in investments that have a proven history of reliable returns," he says. 
Roughly 60% of his portfolio is in bonds — loans investors make to the government or corporations that have less risk but also less return than stocks. The rest is spread out over gold, exchange-traded funds that track international companies and individual stocks. 
This year, his investments have grown 9.73%.That trails the S&P 500 stock index’s year-to-date price return of nearly 11%, as of late July. If you add in dividends, the S&P 500’s average annual “total return” since 1926 is 10.18%, according to S&P Dow Jones Indices.
So Suthar’s stock-light portfolio would need to gain about half a percentage point to match the broad market index’s longer-term return.
He thinks that the market may soon be headed for a correction, and is confident about how the assets are allocated.
“The real test will come once the market stops growing at such as fast rate,” he says
He's also quite conservative in his spending. "I make my own meals often and don't make very many big purchases besides my rent,” he says.
“I'm also single, which probably allows me to save more," he adds. He saves $1,500 to $2,000 a month.

Despite his frugal ways, he still has $2,700 in “fun money”  as a result of points earned on his credit card, which allow him to purchase everything from flights to hotel stays.
When asked if his investing strategy was too conservative, he stood firm. "Sometimes I think about how much more I could make, but I know it's important to stay disciplined because when people start getting greedy, they lose in the market,” he says. 
His best advice for other young Millennials: "Put away as much money as you can from an early age. It takes patience to grow a portfolio, but over time, the more you save, the more it grows."
Russell Robertson, a certified financial planner and owner of ATI Wealth Partners in Atlanta, says that Suthar is definitely on the right track. He wonders, however, if the
young investor will remain disciplined in his conservative approach if the market turns. 
For young Millennials looking for a decent return while keeping their risk profiles relatively low, he offers this advice: 
Put aside extra for retirement: If you’re going to invest conservatively, you should probably save a little more. Robertson offers this example: “If you invest $100,000 and contribute $100 a month for 20 years at 5%, the money will grow to $320,000,” he explains. “If you only earn 3% interest on that money, the value of the nest egg will drop by $100,000.” Simply put, you will have to almost double what you are saving a month with a 3% yield.
Get a realistic picture of the market: Robertson says conservative investors like Suthar should be careful about expecting high returns while investing in traditionally low-yielding assets. “For instance, if you’re investing in fixed-income U.S. Treasurys, expect returns to be equal to the yield, which is currently 2½ to 3%,” Robertson says. “My concern is that he seems to think that you can 'guarantee' the portfolio will return 6% or 7% while taking little risk.”
Diversify your conservative investments: In a low-interest rate environment, high yields are difficult to find. “Given that the price of bonds has been going up for the last 30 years and the Federal Reserve has been hiking interest rates, that can tend to make the value of bonds go down,” advises Robertson. He applauds Suthar for investing in other assets like gold. Another tip is to consider dividend-paying stocks like AT&T, currently yielding 5%, since those tend to be less volatile and pay out more than what U.S. Treasury bonds yield.
Define the purpose of the money: Right now, it feels like Suthar is more focused on the idea of investing conservatively. But that might not be appropriate for what he wants the money to do. “Is any part of this money going to be used in a few years to buy a home or start a family? Or is all of the money going toward retirement?” Robertson asks. If it’s the latter, and he’s not going to touch the money for 20-25 years, Robertson advises investing in 60% equities and 40% in fixed-income assets. “I expect the return on that to be at least 5% over the next 10 years given the current market valuations,” he says.
Speak to a certified financial adviser: Robertson agrees that Suthar doesn’t necessarily need an adviser to run his money, but talking to one can help put things into context. 
“Working with an adviser can help him create specific goals with target dates, re-allocate his funds toward a growth strategy and give him a more solid foundation from which to make these investment decisions,” he says.

Zoë Dawkins loves to live for today.  The 28-year-old communications specialist at Indeed.com, an online resource for finding job listings in Austin, says, "I really value the idea of 'happiness now', so I spend a lot of my money on travel, entertainment, and gifts."

Dawkins is the quintessential YOLO, a term coined by Millennials, short for "You only live once." It makes sense, especially since she grew up in a family that valued having experiences over saving for the future. "My Mom changed careers so many times throughout my life,” Dawkins explains. “She would give up an entire business based on whatever she wanted to do, and just take off and go to Thailand."

While some view that behavior as flighty, Dawkins sees it as freeing. “It made me realize that I could do anything!” she says. But before she began dating her boyfriend, who is also a financial adviser, money was flying out the door. “There have been times when debt has mounted up, or I wasn’t able to bail myself out when a medical crisis hit,” Dawkins says.

After working with him to fix her finances, she set a budget and began putting money into a 401(k).
Now, instead of spending thousands on a lux jaunt to Bali, or hitting happy hour daily, she tracks her weekly expenses using Google Sheets, which allows users to create and modify spreadsheets and share the data online. “Working with a financial adviser who understands my priorities and outlook on life has been incredibly helpful,” Dawkins says. "He gives me a lot of insight into my own spending and has taught me that saving/investing doesn’t have to be burdensome; it can be freeing."

Dawkins' budget includes $1,000 a month for food and entertainment, $500 for travel and $350 for gifts. And in January, she started automatically investing $400 a month in her company’s 401(k) plan. On top of that, Zoë's company matches 50% of the first 6% of her 401(k) contributions. She also has $10,000 saved in an emergency account. "It's nice to know that saving smartly and living a full life don’t have to be mutually exclusive,” she says. “Not only can they co-exist, but they can also lend to one another when properly informed."

Even so, she knows she’s being a bit skimpy on saving for retirement. Dawkins says she will likely invest more once she gets promoted and earns a higher salary. But at the same time, “I don’t regret any of the things that I spend my money on or all of the adventures I have had,” she says. “I want a life that burns with passion, and I feel I have that." Her best advice for other YOLO investors is simple: “Keep the balance,” she says. “Decide what you really need to be happy and what you need to do to be secure. Then, set those things up.”

Russell Robertson, a certified financial planner and owner of ATI Wealth Partners in Atlanta, says that Dawkins was setting herself up to be in a bad financial position. "Before Zoë met with an adviser, there was a tendency to spend a lot with no real emphasis on saving, aside from a cursory amount,” he says. Like Dawkins, there are steps that YOLO investors can take to start putting aside money for the future without giving up their lifestyle. Robertson offers this advice:

Save separately for emergencies: A lot of life is planning for the unexpected. Dawkins is saving more now for emergencies, but Robertson would like that money funneled to a dedicated emergency fund in an online bank like Ally, Capital One, or AMEX. “If your car breaks and you suddenly need $3,000 or $4,000, you’re not going to be able to take those road trips you planned,” he says.

Build toward life goals: For YOLOs, it’s difficult to commit to saving for retirement because it feels like a nebulous thing. “I try to frame it as not this big construct,” Robertson says. “We’re not just saving for retirement, but also for starting a family, buying a house, or taking a really lavish European vacation.”

Live beyond the moment: Robertson tries to convey this message to his YOLO clients: “Yes, this moment is important, but temper that with a little bit of FOMO for the future,” he says, referring to fear of missing out. You may have a great day today, but if you lose your job tomorrow, now what?

Make saving unconscious: Sign up for automatic deductions in the company 401(k). As a rule of thumb, Robertson advises people to save 10%-15%. “Start with 8% of your income, which is equivalent to contributing approximately 13% in your 401(k) because of the company match,” he advises. If you don’t see the money coming out of your paycheck, you’ll never miss it.
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Don’t be embarrassed by your budget: If you make saving unconscious, make spending very conscious. Write down everything you spent in the last month, categorize it, and follow that month to month. “You don’t have to adopt Draconian measures,” he says. If you overspend, address where and why. Creating a written budget makes you aware of what you’re spending on and helps you to conceptualize the bigger picture.

Laura Mignott is ecstatic that her New York-based company DFlash is once again on pace to surpass the million-dollar revenue mark this year.
Mignott, an entrepreneur in her mid-30s with roots in Jamaica, has run a boutique branding agency since 2011 that tells the story of both startups and established brands like Samsung and Chevy.
Now that the business is on solid footing, Mignott is playing catch up on her retirement savings.
Most Americans are falling short of the savings needed to retire comfortably. Millennials like Mignott are no exception. According to a 2016 study by GoBanking Rates that looked at how Americans’ savings differ by life stage, 42% of Millennials indicated they have no retirement savings.
“I wanted to build up the business, so I basically dumped most of my savings, $40,000, into DFlash as we kicked off,” she says.
This CEO considers herself an accidental entrepreneur. “I was working a full-time job, then there was the crash of ’08 and I got laid off,” she says. “There was a lot economic uncertainty and I went through a couple of different jobs.”
Eventually, she cashed out her 401(k) and used part of that savings to help start DFlash with a former business partner. “When you run a business, the idea of saving is so far out of your mind because you’re constantly trying to figure out how to budget,” she says. “Having that emergency savings account helped foster and grow the business.”
Now, she’s turning her attention toward retirement.
“I’ve had some conversations with a financial planner whom I’m about to officially hire,” she says. So far, Mignott has set up a Roth IRA and a 401(k) but also has her sights on investing in some startups.
The socially conscious Millennial says: “I don’t want invest in the new hot toy. It has to make sense for what I want to be involved in as opposed to a random idea that sounds awesome.”
There’s also the $50,000 in student loan debt hanging over her head. Her plan? “Let’s put it this way: I don’t want to be 40 and still paying off my student loans,” she says.
If her company can afford to pay her a larger salary in the near future, she projects that she will pay off a good chunk of the debt in a few years.
For Millennials still on the fence about saving for the future, Mignott says use the many online tools available to learn about different types of investments. Then set it and forget it.
“Also, find good quality experts who give real advice, then take it,” she adds. Most important, “Do not wait.”
Russell Robertson, a certified financial planner and owner of ATI Wealth Partners in Atlanta, says he likes that Mignott understands the importance of prioritizing saving for retirement but says she shouldn’t discount her success.
“Laura is not necessarily behind the eight-ball,” he says. “If her company is earning $1 million annually with a five-person business, investing in the business over the last seven years has paid off.”
For Millennials like Mignott who think they are late to the retirement-saving party, he offers this advice:
Take advantage of peak earning years. If you’re freaking out because you didn’t start investing when you were 21, rest assured. “If you are 30, 40, or even 45, you still have 20-25 years before you’re looking at retirement,” says Robertson. “The upside to starting now is that you can likely save more because you’re earning more and your savings will substantially grow.”
Russell Robertson is a certified financial planner and owner of ATI Wealth Partners in Atlanta. (Photo: Rick Gore)
Increase your emergency savings. Typically, advisors recommend saving three to six months of expenses in an emergency fund. But if your portfolio is too heavily concentrated in one area, Robertson recommends saving at least 12 months of expenses to hedge against major losses. Having that cushion gives you time to figure out what you want to do next.
Automatically increase 401(k) contributions. A lot of companies offer a feature where your contribution can be automatically increased by a certain percentage each year. “If you’re just starting to save, you may feel uncomfortable with a lot of money coming out of your paycheck at once,” says Robertson. Increase your investment by 1% to 2% each year until you reach the maximum annual contribution.
Manage debt differently. “If we assume a conservative 5% return on the stock market and you have subsidized student loans that are 3½% or 4%, your money will be better off invested in the market,” says Robertson. “However, if you have a private loan at 8% interest or a credit loan with a 20% interest rate, then they would be the priority because that will be a better return on that money.”
Diversify your investments. Having all of your eggs in one business basket can be risky, says Robertson. “Being able to invest in other areas — whether it’s the stock market, other startup companies, or real estate — helps diversify your assets,” he advises.