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:
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.”
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.
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.
“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.”
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.
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