Millennials tend to get a bad rap for their so-called reckless spending habits, but in reality, they're pretty grounded on the money front. Not only do 41% of younger Americans manage to save a portion of their earnings each month, but a larger number of millennials is socking away funds for retirement than any other age group, including Gen Xers and baby boomers. Still, a large number of millennials are confused about managing their money, and it's no doubt causing them undue stress.

Only 40% of younger Americans feel they're clear on how much they can afford to spend versus how much they should be saving for the future, according to new data from Northwestern Mutual. Meanwhile, 78% of millennials feel torn by the pressure to strike a good balance between current and future responsibilities (say, paying off student loans versus saving for their own kids' college).

Man in suit presenting document to smiling young couple.


Furthermore, while the stereotypical millennial picture involves a young adult sipping overpriced coffee while indulging in a $10 slice of avocado toast, the reality is that many millennials feel overwhelmingly guilty about treating themselves. In fact, 29% feel uncomfortable or nervous about spending money even when they know they can afford the purchases in question.

The truth is that millennials, by nature, have limited experience in the real world compared to their older counterparts. As such, many might learn to resolve these issues over time. But if you're struggling to manage your money or balance your priorities, it pays to enlist the help of a financial advisor to set you on the right track.

The guidance you need

Some people think that financial advisors are only for wealthy folks who need help managing their millions. But that's just a myth, because you certainly don't need to be rich to seek outside help with money matters, nor do you need to reach a certain income level or age. In fact, the younger you are when you first meet with a financial advisor, the more you stand to benefit in your lifetime.

Not only can a financial advisor help you determine how much to spend versus save, but he or she can help you invest your money in a manner that aligns well with your risk tolerance and goals. Imagine you want to build a family and own a home in the next 10 years. Your strategy will probably be quite different from that of your neighbor who has no interest in procreating or owning property. But without the help of a financial advisor, you might struggle to make the right choices.

Of course, you shouldn't just hire any old financial advisor, so if you're new to the game, here are some questions to ask when making your decision:

  • What sort of fees do you charge? Advisors typically make money by collecting commissions or charging you a fee that's a percentage of your assets under management. Usually, the latter is better for you as a client. Either way, your goal should be to find an advisor who's open about his or her fees, no matter what they happen to be.
  • Are you a fiduciary? Not all financial professionals are fiduciaries, but those who are must always put your best interests as a client ahead of their own. Be sure to favor advisors who hold to the fiduciary standard, since you're less likely to get sold an investment that generates a massive commission but not so much in the way of returns.
  • How risky are the investments you'd recommend? There's no such thing as a risk-free investment, and anyone who tells you otherwise isn't honest enough to deserve your business.
  • How often do you check in with clients? Managing your money is an ongoing process, and one you should be involved in, even if you're outsourcing that task to a professional. That's why you'll want to choose an advisor who will communicate with you regularly and schedule ongoing meetings to assess your goals and progress and review your investments' performance.

Of course, a good way to know that you're getting a solid financial advisor is to seek out recommendations from colleagues, neighbors, or family members who already work with people they're happy with. You'll still want to ask the above questions to ensure that you're covering the right points, but this way, you can approach those conversations with an added degree of assurance.