Client ProfilesYoung Professional

When you are financially successful early in your life it can serve as a foundation for your future. The hard work put in by young professionals today grants them the opportunity for it to potentially pay off down the line.


Professionals early in their career usually make it a point to save money, but it is often the case that they don’t have the time to create a structured financial plan around their assets. Take for example that a young professional with an income in the range of $250,000 a year, vested stock options, and a 401k (but no company pension) was able to save about $500,000. Although concerned about market risk, it is time to start planning for their future.


In this scenario, we would likely suggest creating a substantial investment account that would leverage dollar-cost averaging over a two-year period. Systematically investing in this account monthly with additional money coming directly from the client’s salary could potentially mitigate immediate market risk. In addition, automating future investments directly from their checking account could help build a solid foundation of well researched assets without any extensive work on the part of the client.

Our next recommendation in the process would be to assess any upcoming large lifestyle expenditures (like a new home). With something like that on the horizon, we would likely review their overall stock allocation to determine if some of it could be cashed in. In overvalued markets, we could also suggest additional downside protection through something like a fixed index annuity which would synthetically create a pension through its lifetime income guarantee.


Ideally, clients in the young professional category would have a financial plan that properly prepared their assets for the long-term future. With market risk often being of primary concern, we typically suggest investing over time through dollar-cost averaging which tends to offer protection against market volitality. To further their future financial goals, we would suggest a variety of supplemental strategies like a synthetic pension which offers the ability to defer investment taxes in the annuity.