Financial Planning for Millennials: Focus on These 3 Areas First

Admin • October 13, 2023

Millennials are the generation born between 1981 and 1996 . If you were born within that time frame, you likely grew up with cable TV, cell phones, and the internet . You rest comfortably in between your Boomer generation parents and your younger, Gen Z peers. And while you’ve probably been criticized for being lazy and entitled at some point, your generation has had its fair share of unique money challenges compared to other generations. 

Currently, you’re facing: 

Add in rising inflation and interest rates, and making any progress on your financial goals seems even more difficult than before. Even though 80% of adults report “doing okay financially” , Millennials are lagging behind previous generations. 

We can both sympathize and empathize with Millennials because we’re one of you . We’re not your dad’s stuffy financial advisors — rather, we’re young, relatable, and understanding of the financial mountains you’re facing. We hope to not only help you overcome those challenges but help you thrive along the way. 

We’ve had the privilege of working with many Millennials in our Boise office , most of whom are tech wizards who have taught us a thing or two. We enjoy working with and educating individuals of all ages and backgrounds — if you’re in the Millennial generation, this is a great place to start your financial journey. 

Why is Financial Planning Important for Millennials?

Having a clear strategy for your money makes managing it and reaching your goals easier, even during challenging economic conditions. When creating a financial plan, factor in your unique challenges and create a plan that suits your lifestyle, values, and aspirations. While income and spending habits are highly individualized, here are some ways that Millennials can start taking control of their money goals today.

Budgeting for Millennials

Budgeting may feel like a basic suggestion but it’s a starting point for a reason. Having a plan for your money is key to making it work for you. A budget is essentially tracking your income and expenses — you need to know where your money is going before you can make any adjustments. Once you’ve tracked all your income and expenses, here are your next budgeting steps:

1. Set Goals and Priorities

Everyone has fixed expenses such as rent, food, utilities, etc. Beyond those basic necessities, you get to decide what your financial goals and priorities are. By having specific targets to hit, you can be purposeful with your spending. Whether you want to retire early or take a year off to travel around the world, a financial strategy and spending plan will help you reach those goals.

2. Evaluate Expenses

While quitting your $6 latte habit may not break your budget — those small purchases can eat away at your ability to achieve your bigger financial goals. When you can see where your money is going each month, you get to decide which expenses suit your lifestyle and values. If grabbing coffee and saying hi to your favorite barista is a highlight of your morning, maybe you should leave room for that in your budget. 

3. Build an Emergency Fund

Whether it’s a car repair or a medical bill, an emergency fund can help keep you on track when unexpected expenses arise. Having an account specifically for these financial storms will protect you from using debt or slowing down your progress on other financial goals. Additionally, consider keeping your emergency fund in a high-yield savings account. You will earn interest on the balance and with it being outside of your regular checking and savings account, reduces your chances of spending it when it’s not a true emergency (more on these accounts below). 

Saving For the Future

Regular saving habits can help you achieve your long-term goals. Staying consistent is the key to watching your savings grow over time. Your future self will thank you for the financial security you’ve built. Here’s how to start getting into the habit of saving money:

1. Pay Yourself First

It may seem counterintuitive to set aside money before all your bills are paid, but prioritizing savings means that you are valuing your financial future. Even if money is tight, small amounts add up over time. It will also help prevent you from spending everything you earn. 

2. Automate Your Savings

Automating the process is the easiest way to save. It removes the tendency to save after you’ve spent. You know what they say, “Out of sight, out of mind.” Check if your employer offers split direct deposits, where you can deposit portions of your paycheck to different accounts. If not, set your own deposits on paydays.

3. Use a High-Yield Savings Account

A high-yield savings account is a federally insured savings account that offers a high annual percentage yield (APY). This rate is typically much higher than a traditional savings account. This type of account is a great place to store long-term savings, like an emergency fund or a down payment on a home. You get to earn better than average interest and keep your savings separate from your everyday expenses. 

Invest Wisely

Investing your money can help it grow at a faster rate, working to combat inflation and increasing your wealth over time. Starting to invest as early as possible can help you harness the power of compound interest and build the financial future you’ve been hoping for. Let’s focus on some basics for investing:

1. Take Advantage of Employer Programs

Both 401k and HSA accounts often come with employer matching offers as part of their benefits package. If you have access to these or other employer-sponsored retirement accounts, you should take full advantage of them. Tax-assisted accounts are just one of the ways millennials can diversify their investments. 

2. Have a Long Term Strategy

Investing is a long game. Rather than making emotional decisions based on headlines, commit to time and patience. Marketing conditions change daily but since the 1970’s the stock market’s average return rate has been around 10% . There are a variety of investment options and strategies, which can be overwhelming. At Five Pine Wealth Management , we can help you develop a strategy specific to your needs and personal financial goals.

3. Get the Right Professional Advice

Financial advice for Millennials should not be found on TikTok or any other social media app. Take financial advice from a fiduciary professional who understands your unique goals and needs . We’re different from other financial planners. As fiduciaries, we are required to work in your best interest, not ours. We are also fee-only , which means we aren’t selling you on specific stocks or mutual funds to make a commission. We are driven by client needs, not sales numbers. 

Receive Financial Advice Tailored for Millennials

If you’re still feeling overwhelmed or confused about how best to achieve your money goals we invite you to schedule a complimentary meeting with us today. We carry the distinct privilege of being both highly knowledgeable and experienced while maintaining our approachability. 

We offer comprehensive financial planning with regular check-ins to ensure you’re reaching your financial goals. We also offer specialized investment and life insurance advice. We’d love to connect with you in one of our five local offices or virtually anywhere in the United States. 

Give us a call at 877.333.1015, email us at info@fivepinewealth.com, or visit our website to learn more about what it’s like to work with us.

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What's Inside Your 457? (And Why It Matters More Than You Think)

April 30, 2026
Key Takeaways Your 457 should work alongside your pension to support your overall retirement income plan. Many 457 plans are set on autopilot, but your investments shouldn’t stay that way as you near retirement. Understanding what you're invested in helps you make better decisions when markets move. Turning 50 is your signal to review your 457 more closely so you can check your contributions, risk level, and how it fits with your pension before retirement gets too close. Like many first responders in Washington and Idaho, you probably have a pretty solid grasp of your "Plan A." Between the WA LEOFF Plan 2 or ID PERSI, you’ve spent your career earning a guaranteed monthly pension. It’s the foundation of your retirement — the steady paycheck that arrives regardless of what the stock market does. But then there’s that "other" account. The one you’ve been tucking money into every pay period through deferred compensation. In Washington, it’s usually the Washington State Deferred Compensation Program (WSDCP); in Idaho, it’s often the State of Idaho 457(b) Plan. When we sit down with firefighters and police officers who are within 10 years of their "end of watch" date, they usually know two things about this account: how much is in it and that they’re glad they started it. But when we ask, 'What is that money actually doing?' — that question usually gets a pause. If you’re 50 or older, it’s time to move past the "set it and forget it" mentality. Let’s take a look at how your 457 works and how to make sure it’s working for you. 457 Plan Investment Options  Unlike your pension, which is managed by the state, your 457 is a “defined contribution” plan. That means the outcome depends entirely on how much you put in and how those funds are invested. A 457 plan is just a container. Think of it like a toolbox. What matters is what’s inside the box. Your account isn’t sitting in cash (at least it shouldn’t be). It’s invested in a mix of underlying funds, usually including: Stock funds (equities): These are your growth engines. They tend to go up over time, but they can be volatile. These could be U.S. stock funds or international funds. Bond funds (fixed income): These provide stability and income, but with historically reduced long-term returns. Stable value or cash equivalents: Lower risk, but also lower growth. Most public service 457 plans in the Northwest offer a menu of these options. Some people choose to build their own mix, while others choose a single “all-in-one” fund and let it do the work. This brings us to the most common choice we see… What is a Target-Date Fund? A Target-Date Fund (TDF) is designed to be a one-stop shop. The “date” in the name is the year the fund assumes you will retire. If you plan to hang up the uniform in 2030, you’d likely be in a 2030 fund. A TDF automatically shifts its risk level as you get closer to that date. This is called the glide path . When you are 20 years away from retirement, the fund is aggressive. It buys mostly stocks because you have time to recover from market crashes. As you get closer to the target year, the fund manager automatically “glides” the investments away from risky stocks and into “safer” bonds and cash. TDFs are built for the “average” American worker who relies solely on Social Security and a 401(k), but you aren’t the average worker. You have a LEOFF or PERSI pension. Because your pension acts like a “super bond” (stable, guaranteed income), being too conservative in your 457 might hinder your growth. Conversely, if you’re planning to retire at 53 (common for LEOFF 2) but your fund is target age 65, you might be taking way more risk than you realize. It’s also important to note that two funds with the same year, for example, 2035, can have very different levels of risk depending on the provider. One may still hold 60% in stocks near retirement, while another might be closer to 40%. How Risk Changes as Retirement Approaches In your 20s, 30s, and even early 40s, “risk” is your friend. Risk is what grows a $50,000 account into a $500,000 account. However, as you approach the age of 50, the definition of risk changes. That’s because you’re entering what we call the “retirement red zone,” roughly five years before and five years after your retirement date. This is when: Your portfolio is at its largest You have less time to recover from downturns You may soon rely on the money for income We look at two specific types of risk for our clients: Sequence of Returns Risk: The risk that a market crash occurs just as you start taking withdrawals. If the market drops 20% the year you retire, and you start pulling money out to travel or pay off the mortgage, your account may never recover. Inflation Risk: If you get scared and move everything into the “Fixed Account” or “Stable Value Fund,” you might not lose money, but you’ll lose purchasing power. If your account earns 2% but the cost of living goes up by 4%, you’re technically getting poorer every year. Finding the “Goldilocks” zone — not too hot, not too cold — is the primary job of a pre-retiree. The Age 50 Checklist Once you’re in your 50s, it’s time to stop running on autopilot and take a closer look at your 457. Check Your “Catch-Up” Options In 2026, the standard 457 contribution limit is $24,500; however, once you’re 50, you can add an extra $8,000 in “Age 50 Catch Up” contributions. Even better, if you're within three years of your normal retirement age and haven’t maxed out your contributions in previous years, you may be able to contribute up to double the normal limit ($49,000). This is a massive boost for your savings. Diversify Your Tax Buckets Most first responders have their money in a Traditional 457, meaning you get a tax break now but pay taxes when you take the money out. Both Washington and Idaho offer Roth 457 options. With a Roth, you pay the tax today, but the money grows and comes out tax-free. For high-earners who expect their pension to keep them in a higher tax bracket during retirement, having a “tax-free” bucket of money can be helpful. Coordinate With Your Pension If your LEOFF or PERSI pension covers 70% of your needed income, your 457 can afford to be a bit more aggressive in fighting inflation. If you plan to use your 457 to bridge the gap until you collect Social Security, that money needs to be protected differently. Let’s Take a Look Together At Five Pine Wealth Management, we work with first responders in Washington and Idaho who are approaching retirement and want clarity around their financial picture. We understand how LEOFF Plan 2 and PERSI fit into the bigger picture, and how your 457 can support the retirement you’ve worked hard to build. If you’d like help understanding what you’re invested in, we’d be happy to take a look with you. You can email or call us at 877.333.1015 to schedule. We’d welcome the conversation. You’ve spent your career looking out for the community; let us help you look out for your future. Frequently Asked Questions (FAQs) Q: Is a Target-Date Fund enough for my 457 plan? A: For many people, it is, but as you get closer to retirement, it’s important to review whether the fund’s risk level matches your timeline and overall financial picture. Q: Is there a penalty for taking money out before age 59½? A: No. Unlike a 401(k), the 457 plan has no 10% early withdrawal penalty if you leave your employer, making it an ideal tool for first responders retiring in their early 50s. Q: Should I choose a Target-Date Fund or build my own portfolio in a 457? A: Target-date funds offer simplicity, but building your own portfolio allows for more customization. If you have a pension that already provides a stable income, building your own could be a good option.

He Had $1.1 Million and Almost Went Back to Work. Here's What Changed

April 22, 2026
Key Takeaways A portfolio designed for accumulation may carry too much risk, or the wrong kind of risk, once you stop contributing. When two spouses are at different financial life stages, their investment strategies should reflect that difference. A Roth conversion strategy during the years before required minimum distributions begin can meaningfully reduce your long-term tax burden. Rob spent 30 years building a picture-perfect financial foundation for his retirement. He maxed out his 401(k) and stayed disciplined through market downturns. By the time he retired from a long career in plant management and HR, he had a nest egg most people only dream about. But then retirement arrived, and with it came a new kind of anxiety. Rob spent all those years learning how to build wealth, but never how to draw it down. The accumulation phase was clear, but the decumulation phase is far more complex and far more personal. Rob had hired a financial advisor when he retired, hoping for guidance through that transition. Instead, he got portfolio management and investment decisions without the broader planning context he needed. That relationship didn’t last a year. And that’s when he and his wife Christie, came to Five Pine. The Numbers Behind the Plan: When They Started Today Rob’s age 57 63 Investable assets $1.1 million $2.5 million Net worth — $3.5 million Primary challenge No decumulation plan, Comprehensive plan in place heavy pre-tax exposure Key strategies Portfolio redesign, Ongoing tax planning, Roth conversion planning rebalancing When Saving Well Isn't Enough When we first met Rob and Christie, a few things stood out right away. Rob was recently retired with $1.1 million in investable assets (the vast majority of it in pre-tax retirement accounts). Christie, about ten years younger than Rob, was still working and earning a high income as a part-owner of a small business. They were a dual-financial-life household: one person winding down, one still in full accumulation mode. Rob’s most pressing concern was straightforward to state but harder to solve: how much could he spend without putting their retirement at risk? He wanted to travel, renovate the house, and buy a new vehicle without second-guessing himself. But after those decades of saving, spending felt foreign, even a little reckless. He had seriously considered going back to work, not because he needed to, but because he felt he couldn’t trust the numbers. Underneath that, a long-term tax problem was simmering. With most of their savings in pre-tax accounts, Rob and Christie were looking at significant required minimum distributions (RMDs) starting at age 73. And Christie, likely to outlive Rob by a meaningful margin, would eventually face those distributions as a single filer at higher tax rates. They weren’t in trouble, but without a plan, they were heading toward unnecessary complexity and tax liability. A Plan Built for Retirement, Not for Accumulation We started with the full financial picture. Before we touched the portfolio, we built a comprehensive financial plan and stress-tested it against different market scenarios, spending levels, and timelines. Once Rob saw the projections running out over a 30-year horizon, his hesitation about retirement began to lift. The plan gave him the number he needed and, more importantly, the confidence to trust it. From there, we redesigned the portfolio to match Rob’s phase of life. He had come from a Dave Ramsey background and had always preferred an all-equity approach: aggressive, growth-focused, and straightforward. That served him well during the accumulation years, when he contributed every month and had decades to recover from downturns. But in retirement and drawing from the portfolio regularly, it introduced more risk than his situation warranted. We restructured his holdings to roughly 60% equities, 25% fixed income, and 15% in alternative investments, specifically private credit funds and private real estate. The alternatives were a meaningful addition. They could potentially carry lower price fluctuation than publicly-traded assets and have the ability to generate distributions, which may potentially help support spending needs without forcing untimely equity sales. Christie's accounts, meanwhile, stayed aggressive. She's still contributing through her employer plan, still has years of earning ahead of her, and has time to weather market swings. Finally, we put a Roth conversion strategy in place for the years ahead. Timed to begin when Christie retires, the strategy takes advantage of a window when their income will likely be lower, but before RMDs kick in and before Christie potentially files as a single filer at higher tax rates. Converting pre-tax dollars gradually reduces the accounts that will eventually be subject to mandatory distributions, potentially saving hundreds of thousands of dollars in taxes over time. From Hesitation to Confidence Rob came to us considering whether he needed to keep working. He left with a plan that showed him that he didn't. Once the plan was in place, Rob and Christie started making the most of their years together, international sailing trips, travel they had put off, and experiences they had earned. A health scare along the way reinforced what the plan had already made clear: the goal is to fund a life worth living while you're healthy enough to live it. On the investment side, market volatility became an opportunity rather than a threat. When markets dropped sharply during a period of economic uncertainty, we rebalanced, selling fixed income to buy equities at a discount. As markets recovered, those moves contributed meaningfully to their overall growth. Five years in, their investable assets have grown from $1.1 million to $2.5 million. Beyond that, Rob and Christie have referred five family members to Five Pine, a reflection of the trust that developed alongside their plan. In Christie's own words: "Ben and Jeremy are honest, approachable, and very professional. They take great pride in getting to know clients and listening to each individual's goals. Honestly, they are the best fiduciaries I have ever worked with, by far." Your Decumulation Strategy Starts Before You Retire Rob's story is more common than most people realize. Disciplined savers often arrive at retirement without a spending plan, a tax strategy, or a portfolio suited to this new phase of life. If you're within five to ten years of retirement (or already there), it's worth asking whether your current advisor is doing comprehensive planning, including tax planning for retirement, or simply managing your investments. Over the course of a long retirement, that distinction can determine whether or not you’re equipped to tackle retirement with confidence. We'd love to help you find your number. Email us at info@fivepinewealth.com or call 877.333.1015. Let's talk.* Frequently Asked Questions (FAQs) Q: When should I start building a decumulation strategy? A: Ideally, five to ten years before you plan to retire. That window gives you time to gradually reposition your portfolio, identify potential tax issues before they become expensive, and stress-test your spending assumptions while you still have income coming in. Q: What role does Social Security timing play in a decumulation plan? A: Claiming Social Security early locks in a permanently reduced benefit, while waiting until 70 can increase your monthly payout substantially. The right timing depends on your health, other income sources, and whether a spouse will eventually depend on your benefit as a survivor. Coordinating with your Roth conversion strategy is also worthwhile, since both affect your taxable income. Q: What happens to my decumulation plan if the market drops early in retirement? A: This is often called the sequence of returns risk. A significant market decline in the first few years of retirement can have a lasting impact on a portfolio, because you're withdrawing funds at lower values. A well-designed decumulation strategy accounts for this by maintaining a portion of the portfolio in less volatile assets, so you're not forced to sell equities at a discount to cover living expenses during a downturn. *Names have been changed to protect client privacy*