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If you’re looking for a personal finance book to give a young adult this holiday season, my top suggestion is Money Like You Mean It: Personal Finance Tactics for the Real World, by Erica Alini. Ms. Alini, national online money reporter at Global News, has written a book that feels connected to what’s going on right now in the economy. For example, she offers some good ideas on how to exploit a job market that has given workers an unusual amount of leverage in negotiating pay and benefits. Naturally, she also covers expensive housing costs. Here’s an exchange I had with Ms. Alini recently by e-mail:

Q: The subtitle of your new book jumped out at me – personal finance tactics for the real world. Would it be accurate to say you’ve found that some traditional personal finance isn’t working in today’s world, at least for young adults?

A: Yes, that’s exactly what I was getting at. Personal finance is becoming more and more complex. I’ll give you a few examples. So much financial innovation is geared toward making us buy or borrow more: we now have not only credit cards, but mobile payments and BNPL (buy now, pay later) apps, which can be a psychological slippery slope into overspending. You can buy stocks with an app, but that also means you can make really costly investing mistakes with a few thumb strikes. Even buying home insurance isn’t straightforward any more. If your house is at risk of flooding (and more and more of us face that risk), you’ll need to buy optional, additional coverage, and it’s up to you to know this. Everywhere you turn, there are more choices, more financial products and more things you need to know to be able to make good decisions. We all need to level up. But the challenge is greatest for millennials and Gen. Z who also face mind-bending housing costs and are often bogged down by student debt just when they should be taking off in life.

Q: One of your chapters is titled, Everything Starts With Housing. What do you mean by that?

A: How much you’re going to spend to keep a roof over your head is one of those critical decisions that can set your long-term financial trajectory. If you spend too much on housing – whether you have a mortgage or a landlord – then you’re going to have a hard time paying for the rest of your life. And reconciling the cost of shelter with the cost of everything else has become the biggest financial challenge for my generation.

Q: How do we get millennials and Gen Z thinking strategically about retirement when housing is so expensive and many people in these groups are skeptical they’ll ever be able to retire?

A: The earlier you start to save and invest for retirement, the more time there is for compound interest to work its magic. Even if you can only save a tiny sliver of your paycheque for retirement, it’s important to set up those automatic transfers. Then, as your income increases, or your debt payments shrink, give yourself a raise and boost your contribution. That said, don’t panic if you haven’t started yet: you haven’t missed the boat. You’ll have to save more aggressively but hopefully if you’re older you also have a higher and more stable income.

Q: One of the things I like about your book is how you’ve integrated the job market into personal finance. What advice do you have for young adults who want to take advantage of a job market that, thanks to the pandemic, offers real opportunity to find better pay, benefits and work-life balance?

A: This is your chance to job-hop your way to higher pay, but make sure you know your worth. To gather on-the-ground intelligence, talk to colleagues and people in your industry. Career coach Allison Venditti suggests playing the “over-under game.” People often won’t tell you how much they make, but are more open to saying whether they make more or less than a certain amount. That information is a good way to make sure you don’t lowball yourself during pay negotiations. Also remember: there’s so much more to discuss than your salary. For example, you can negotiate work arrangements (like working from home), flexible hours, vacation, professional title and waiving the waiting period for health and retirement benefits. You can even ask for a retirement payout if the pension benefits at your new job are less generous than what you were getting in your old gig.

Q: Millennials and Gen Z have had some real success as investors in the pandemic as almost everything went up in price. How do you suggest they achieve long-term investing success?

A: A lot of people developed a taste for buying and selling single stocks in the gravity-defying bull market we’ve had since the spring of 2020. I think there’s a sense that investing (whether it’s stocks or crypto) is the only way to get ahead and accumulate wealth if you can’t get into the real estate market. I completely understand that sentiment, and it’s great to see so many people investing. But the evidence is clear: it’s extremely difficult to beat market returns over many decades. If you want to grow your savings over the long term, then index investing – buying and holding investments that track the movements of broad financial indexes – is a great way to do so. Robo-advisers, all-in-one ETFs and index mutual funds are three low-cost, low-effort index investing options I discuss in the book.

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