Since Friday, June 24, 2016, the world has been collectively biting their fingernails to the nub after the results from the European Union (EU) voting referendum returned, showing that UK citizens voted to leave the EU. What does the Brexit – Britain’s Exit – have to do with you? I’m glad you asked.
The European Union, also known as the EU, is a 28 European country partnership involving economic and political decisions that affect millions of citizens. Formed after World War II to nurture economic harmony, the idea behind the union was “countries that trade together stay together,” or in political terms, countries that swap goods are less likely to go to war with each other.
Since its official founding in 1993, the EU has grown to become a “single market” allowing goods and people to move around, basically acting as if the member states were one country. It has its own currency, the euro, which is used by 19 of the member countries, its own parliament and makes its own laws regarding everything from the environment, transport, consumer rights and even minute details like mobile phone charges.
So when the UK voted to leave this huge global group, it messed up a lot of stuff basically. The most concerning thing being the significant downturn in the European stock market.
What You Should Do Next
31-year-old personal finance expert, Dominique Broadway said the decision will affect her age group significantly more than she thinks they realize. “Millennials should really pay attention to Brexit and base their important financial decisions on what has already happened and what’s to come,” she said. The founder of the Finances Demystified Bootcamp young adults should use Brexit to their advantage while they can. Although UK votes led to the global market loss $3 million loss in the global market on Friday, European markets opened higher this week, which means US could follow suit.
“If you don’t have a stock portfolio, start one ASAP,” she said. “Everything is 20% cheaper than usual and when the market corrects itself as it always does, you’ll come out on the winning side.” She said the best low cost carriers for new stock investors are E-Trade and Fidelity, two sites that allow you to start investing and trading at little to no cost.
Dominique also suggested that the beginners start small by investing in company stock that they are familiar with. “I suggest to my clients that buying from brands you know and trust is always the best move when in the beginning phase of their investment journey,” she said. “For instance, I bank with Chase and use a MacBook Air so I own JPMorgan Chase and Apple stock.”
She also stresses the importance of taking a second look at their 401k and Roth IRA packages. “Although most millennials are years from retirement, volatility could still be on the horizon and affect their money in the coming years leading up to Britain’s exit from the Union,” she said.
Keeping a close eye on available funds or cash-on-hand is a smart move as opposed to selling stock in an increasingly uncertain market that could negatively impact retirement goals. In the meantime, we’ll keep watching and hope for the best.
MADE by Jasmine Browley