Getting to Know Your Investing Persona

Even the most independent personalities fit into a cohort – a community of people who share not only broad demographic stats but also private concerns, mindsets, lifestyles and motivations.

Understanding your investing “persona” can be surprisingly liberating. It’s encouraging to realize you’re not alone in your financial worries (and that others share your reasons for procrastinating). It’s also bracing to recognize that solutions do exist that can successfully bridge you to your financial goals. Finally, knowing your own investing persona can help launch you into finally acting.

We built TradeKing Advisors with several investing personas in mind. We’ll delve into each of these personas more in future posts. But See if you recognize yourself in this overview:


Millennials: Wary, Idealistic, Online

Saddled with student loans, the generation born between 1980 and 2000 faces a challenging job market – with dwindling help from their Boomer parents, whose own retirement portfolios and house values took a hit in recent years.

Millennials are pragmatists who’ve learned to live on a tight budget. At the same time, they’re idealists: they want to live and work in sync with their values, and they choose products and services that resonate with those values.

This is the “digital native” and mobile generation. Millennials expect technology to streamline their investing experience and demand instant access from all devices.

  •  What is this group’s biggest financial challenge? Over-conservatism. It’s nearly impossible to save enough money to retire without taking on some investing risk, which makes millennials nervous.
  •  What about their biggest financial strength? Thrift is already ingrained in millennials. If they can bring themselves to take on appropriate financial risk, and the investment process is easy, online and automatic, they’re primed to start meeting their goals.


Accumulators: Overwhelmed, Efficiency-Seeking

Investors in their 30s and 40s – let’s call them “Generation X” – are collectively in the accumulation phase of life. They’re buying houses, having children, advancing in their careers, maybe starting to take care of ageing parents – more is the watchword with this group.

Accumulators may earn a lot relative to millennials, but that money is all accounted for. What’s even scarcer for this group than money is time. They know they should be investing more intelligently for their own retirement and their kids’ education. But who has the time to figure out out? Their to-do list is a mile long.

Technology-wise, this group is comfortable with online investing, but they also like to know they can pick up the phone if necessary.

  •  What is this group’s biggest financial challenge? Finding a quality investment process that fits their budget and maximizes on their limited time.
  •  What about their biggest financial strength? Accumulators are efficient. They’ll run with the right financial solution – once they can identify it.


Retirees: Focused on Sustainability

Whether they’ve already retired or will do so soon, retirees have a totally different set of concerns. This group is more focused on generating current income and preserving their capital than younger investors. They’ve had a tough run in the recent low-interest-rate environment. They’re also cognizant of the fact that they don’t want to outlive their capital, so a portion of that money needs to keep growing for them.

Many folks in this group have had to push their retirement date further into the future, to make sure they’re maximizing on peak earnings at their jobs to plump up their nest eggs. Other retirees have been forced out of jobs early, activating their retirement plan much sooner than they may’ve planned for. Timing is paramount, but often unpredictable.

Retirees are all over the map in terms of comfort with technology. Some hesitate to invest online, but many others love it – and have ample free time in retirement to get more involved in their investment plans.

  •  What is this group’s biggest financial challenge? Timing and balance. It’s tough to generate sufficient income to live on today, while keeping their investments growing enough to cover future needs. (TradeKing Advisors offers portfolios to help retirees with many of these needs today, and we’ll add an income-focused portfolio to the mix soon.)
  •  What about their biggest financial strength? Money – most of these folks have accumulated a nice nest egg. The challenge is managing it wisely and efficiently to last.


Women: Unsung, Under-Served

Of course, women cut across all the previous generational personas – but in some ways they’re also a persona of their own, with unique challenges, opportunities, and concerns.

Women will contribute $6 trillion globally to the world’s economy, according to Boston Consulting Group. In the U.S. they enjoy more power and earning potential than ever before. Women make up the majority of college grads, they represent nearly half the labor force and are the primary breadwinners in 42% of households. Yet women tend to lag behind in reaching their financial goals.

Women’s career arcs differ from men’s in ways that impact their investing life. They live longer, meaning their retirement capital has to last even more. They’re more likely to take time away from paying jobs – usually in their peak earning years – to raise children or care for ageing parents. As a group, women tend to be more risk-averse and less confident in themselves as investors.

  •  What is this group’s biggest financial challenge? Putting their own financial needs first. Women are often so busy caring for others and juggling priorities, it’s easy to push off their financial plans for themselves to tomorrow.
  •  What about their biggest financial strength? Women can easily turn their financial challenges into strengths. A little self-doubt can make you a shrewd consumer of financial services, and tempering risk aversion with proper risk appetite can make for the ideal balance.

We’ll explore all of these personas more in depth in the coming months. Of course, while there’s real value in identifying where you fit into a group, we also know that every investor may not fit squarely into just one category. That’s why our questionnaire guides you step-by-step through the creation of a portfolio profile. Whether you match a persona perfectly or fall somewhere in-between, TradeKing Advisors can help you build a portfolio customized for your objectives.

Determine who you are as an investor, and TradeKing Advisors can help you on your journey to becoming your best financial self.  We invite you to take our brief questionnaire. You’ll determine your risk tolerance, time horizon and we’ll suggest a portfolio that suits your needs and investing style.  Why not give it a try today?


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