Edward Jones Diversity Series

This Edition: "Young, Successful, Single and Black"

You are young, successful, single and black. Your wardrobe is impeccable. Every night you are fortunate enough to unlock the door to a nice apartment or home. When you are ready to travel you can do so behind the wheel of a shiny car or by flying to another city for the weekend. While your life may be very comfortable now, are you properly preparing for an equally comfortable retirement?

*Lisa Wright, a thirty-something professional and part-time graduate student from Detroit, Michigan has a lot going for her. She has a good job at one of the Big Three auto manufacturers. She's stylish, drives the latest SUV, and has traveled throughout the Caribbean. Her sister, *Nicole Wright, also in her 30's, is just as upwardly mobile, is a part of Detroit's young, black professional social scene and also has traveled to the Caribbean as well as Hawaii.

While both sisters are alike in enjoying the freedom that the single life often brings, they are opposites when it comes to saving. Lisa has no short-term savings, but regularly contributes to her 401K and IRA.

"In the past, I contributed ten percent, now each month I contribute at least five percent to my 401K plan and $50.00 a month to an IRA," she said.

Conversely, Nicole has accumulated significant cash savings, but has not yet participated in her company’s 401K plan.

"I contribute $200 a month to my savings account. I just prefer having access to cash when I need it," she said.

Despite very different saving habits, both sisters know there is room for improvement when it comes to planning properly for their financial future.

"Ultimately, I want to be disciplined enough to set up a savings account and have $50.00 deducted from my paychecks each month to use only for emergencies or perhaps even a down payment on a home," said Lisa.

"When my company’s enrollment period comes around again, I will definitely participate in the 401K plan," said Nicole.

Highly trained and licensed Edward Jones investment representatives like M. Kevin Carrier could work with them to develop a multi-tiered approach toward financial security. The model for this approach is a pyramid working its way upward with cash at the foundation, then income, growth and income, growth and then aggressive growth at the apex.

"Although it’s great that both women are saving, they are on opposite ends of the spectrum. Lisa could face immediate financial hardship because she does not have a minimum of 3-6 months of expenses saved," Carrier said. "We could consider building expenses savings in an investment with a five- to ten-year time horizon," he said.

Carrier also would encourage Lisa to "maximize her 401K to at least ten percent."

For Nicole, Carrier would urge her to participate in her company’s 401K plan as soon as possible. "Someone who begins saving for retirement at age 18 and stops at age 35 will generally have more money than someone who begins at 35 and retires at 65," he said.

In addition to contributing ten percent of her earnings to her company’s 401K, Carrier said that Nicole could make better use of her savings "that may be earning less than inflation in a savings account" by keeping a portion that equals at least three months of expenses. Another portion could be used "to buy good investments that have a five- to ten-year timeframe." Eventually, these savings could be used for a down payment on a home, a purchase that generally has good potential for building individual wealth.

Each investor’s situation is unique and requires individual attention and planning. Licensed Edward Jones investment representatives like M. Kevin Carrier can help *Lisa and Nicole Wright and other young, successful, single professionals make their most of their success. With nearly 9,000 branch offices nationwide, Edward Jones is around the corner and in your neighborhood. To find an investment representative in your area or for information about becoming an investment representative yourself, visit www.edwardjones.com.

*Names have been changed to protect privacy.