Stop whining and give us your money

One of the things that young people seem to want in large amounts is money. But with the media telling them exclusively about millions of ways to spend money, few young people have any idea how to accumulate it.

Here at Praxiomatic we are happy to reveal to you the magic secret of accumulating lots of money. And we will do it in only four words. Brace yourself: Save and invest regularly.

But you need money to make money, right? Fear not, investment-ready young people! Now comes a flock of investment firms who suddenly realized en masse that you may be young and beautiful but you can't necessarily can't pony up a $10,000 account minimum (Eleanor Laise in WSJ, sub. req'd):

Mutual-fund firms have a new message for young investors: Stop whining and give us your money.

In an attempt to attract the next generation of customers, Wall Street is rolling out a host of new offerings designed to squelch the excuses that keep many 20- and 30-somethings from investing outside of their 401(k) plans.

Can't afford the hefty four- and five-figure minimums required by many mutual funds? They'll slash the minimum investment below the cost of an iPod. Not sure which funds to buy, and in what amounts? They're launching all-in-one products that take much of that work off your hands. Don't know how to save for a car, a house and that far-off mirage called retirement? They'll deluge you with online tools and easy-to-enroll individual retirement accounts.

Now you can invest with Schwab for a hundred bucks — that's fifty bucks less than a measly 2GB iPod nano.

You want to be rich when you're old? Then be smart when you're young.

Words to the young and wise

Emily Meehan of the Wall Street Journal spells out "What to Do with $2,500" — a column that gives younger investors clear plans of action from financial wizards, most of whom normally advise only millionaires:

I spoke with five financial advisers about what a young investor should do with a small windfall: $2,500. I created a profile of a twentysomething novice investor who doesn't have debts and is diligently paying into a 401(k). Investor X doesn't necessarily want to lock up this money until retirement. He or she may want to buy a house, fund a year off or have something socked away in case of a car crash or other emergency.

The advice comes from five different managers, including independent financial planners as well as consultants from the likes of Schwab and T. Rowe Price. They come up with five quite different plans of action:

1. Set up a Roth IRA
2. Put some money aside in a CD
3. Be aggressive
4. ETFs!
5. Take the bond route

I don't want to critique the individual strategies. What's nice about the slant of the article is that it proposes several real-world, proactive plans that are actually achievable by a 25-year-old. It focuses on what can be done, and why. People, especially younger people with the need but without the access to the holistic advice of a wealth manager, could benefit from guidance that says, as specifically as possible, "do this."

How big is the demand for such proactive plans of action? You decide. Emily's column is #1 in the "Most Popular" links at today's WSJ.