Money doesn’t have to be complicated. You can make it simple and even automate most of it. That’s exactly what financial planning expert Skyler Fleming wants young professionals to understand.
Skyler hosts a brand new podcast called “Financial Planning for Young Adults.” He breaks down the seemingly complex world of financial organization and planning into strategies anyone can understand and use. As a financial coach and advisor, he’s on a mission to help young people avoid costly mistakes and build wealth early. In my interview with Skyler, we touch on just a few things you’ll learn through the podcast.
The Biggest Money Mistakes Young Adults Make
Credit card debt tops the list of financial traps. Once you fall into it, you might never climb out. The cycle becomes a trap that’s hard to escape.
The other major mistake? Chasing goals other people set for you. Parents often pressure their kids to buy houses before they’re financially ready. They might not understand how different things are today.
Consider the numbers. A 20% down payment now can run $200,000. How do you save that much when you’re making $70,000 a year? Meanwhile, your parents might have a $900 monthly mortgage while you’re looking at $3,500.
Show your parents the facts. Walk them through the actual numbers of what a mortgage would cost you today. The reality check often relieves the pressure.
Tax Advantages You Can’t Afford to Miss
Wealthy people know the tax opportunities. Young adults need to learn them too.
When you start contributing to retirement accounts, you discover two key benefits. First, compound interest grows your money over decades. Second, you get tax breaks that make that growth even more powerful.
You have two main retirement account types:
Traditional accounts: You contribute pre-tax money. When you withdraw it later, you pay taxes on the contributions and all gains.
Roth accounts: You contribute after-tax money. When you withdraw it later, including all gains, you pay zero taxes.
Here’s where it gets exciting. The Rule of 72 helps you estimate when your money doubles. With typical market returns, your money can double every 8 to 10 years. Over 40 years, that money doubles multiple times. Now add the tax benefits on top. All that growth becomes tax-free (with Roth) or tax-deferred (with Traditional).
Starting now opens practically limitless opportunities by the time you need the money.
The HSA Secret Weapon
A Health Savings Account (HSA) might be the best tax-advantaged account available. It’s the only account where money goes in tax-free, grows tax-free, and comes out tax-free for qualified medical expenses.
You must have a high-deductible health plan to qualify. Look for “HSA eligible” on your workplace benefits or marketplace insurance options.
Most people (96%) use HSAs simply. They contribute money and withdraw it to pay medical bills. They still save on taxes through pre-tax paycheck contributions or tax deductions when filing.
But here’s the advanced strategy. You can invest your HSA money in index funds, just like a 401k. Pay your medical expenses with regular cash. Save your receipts. Years later, reimburse yourself from the HSA.
This lets your HSA grow with the stock market. One example: A wife gets monthly massages for headaches (a qualified medical expense with a doctor’s note). The HSA investment gains essentially pay for free massages through stock market growth.
Keep Investing Simple With Index Funds
If you’re starting from square one with investing, index funds offer the perfect solution.
An index fund tracks a specific index. The S&P 500 is the most common example. You can invest in funds that track all U.S. stocks, all international stocks, or specific sectors like technology or energy.
The best feature? Index funds are self-cleaning.
Say you invest in an S&P 500 index fund. It holds roughly 500 companies. If company number 490 starts failing, you don’t need to watch closely or sell at the right time. The index automatically removes failing companies before they hit zero. New companies replace them.
Compare this to owning individual stocks. If your life gets busy and a company you own plummets to zero, you lose everything you invested in it. Index funds protect you from this risk automatically.
Automate Your Financial Life
Automation is the key to building wealth without constant effort. You go to work, play tennis, or enjoy life while your money grows behind the scenes.
Start by automating regular monthly activities. Don’t try to automate everything at once. Pick one thing you do every month, automate it, then move to the next.
Examples of what to automate:
- Credit card payments (set to pay statement balance automatically)
- 401k contributions (directly from your paycheck)
- IRA contributions (scheduled monthly transfers)
- Savings goals (automated splits when paychecks deposit)
New banking apps let you automate savings based on direct deposits. When a deposit over $1,000 hits your account, the app automatically splits it into different “buckets” for various goals. No waiting for HR to process paperwork.
One client’s story shows the power of automation. They always lived paycheck to paycheck. Any unexpected $50 or $100 expense caused major stress. After setting up automated savings, they said after just two paychecks: “I’ve never had so much savings in my life.”
The amount wasn’t huge, but the relief was. When a $50 expense came up, they just paid it. No stress, no borrowing from friends, no returning purchases. Automation handled the saving for them.
The Best Budgeting Apps Right Now
Mint was once the go-to budgeting app, but it shut down. Monarch Money now leads the market. It connects your accounts, has a great interface, and offers helpful features on the back end. Give it a real chance and it can transform your budgeting.
Other options include:
- My Budget Coach: You can work directly with Skyler Fleming as your coach.
- Tiller Money: Connects your banks to a spreadsheet (for spreadsheet nerds)
- SoFi: Banking app with vault features for automated savings
- Crew: Fintech app built around automation with “pockets” and “autopilot rules”
An app exists for every type of person. Whether you want simple tracking or detailed control, you’ll find something that works. (Note: Several of the links are affiliate links. Skyler receives a small commission when people use his link for purchases.)
Start Young, Retire Rich
Financial planning works best when you start early. Even young professionals just entering the workforce have incredible opportunities.
Consider this example. Starting a 401k immediately and contributing enough to get the company match can double your money through employer contributions and compound interest, even before you leave that job. That’s money growing for retirement that gives you options later.
You might take a mini-retirement in your 30s or 40s. You could reach “Coast Financial Independence,” where you’ve saved enough that compound interest will grow it to what you need at retirement. At that point, you stop saving for retirement and use your income for other goals.
Start young, and you’ll be able to do whatever you want with your life.
Your Next Steps
Ready to take control of your finances? Listen to Skyler Fleming’s podcast, Financial Planning for Young Adults. Find it on any podcast platform or YouTube. The show is video-first, so YouTube offers great graphics and visual explanations.
For more of Skyler’s work, check out his podcasts:
Financial Planning for Young Adults
Money and time are the two things we seem to always need more. Financial organization is just like organization in any other sector of our lives. Master money and time, and you’ll build the life you want. Start today.
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