(The author is a Reuters contributor. The opinions expressed are his own.)By Geoff WilliamsSept 16 For years, Mike Lescelius, 54, a sound recording engineer in Murphysboro, Illinois, struggled with managing his money. A lifetime sufferer of attention deficit/hyperactivity disorder (ADHD), he would forget to pay bills for credit cards, utilities and even his mortgage."My credit is pretty much shot," says Lescelius, who has seen his phone service turned off multiple times and his electricity turned off twice - all for nonpayment. That not only affected him, but tenants living in an apartment in his home. "I felt like an idiot each time."Household money management can be an especially vexing problem for anyone with ADHD, a neurobehavioral disorder that is more common in children, but found in 4.1 percent of adults, according to the National Institute of Mental Health. It can affect how sufferers focus.
People with the disorder are far more likely to miss loan payments (57 percent compared to 27 percent for people who don't have ADHD); buy items impulsively (62 percent compared to 18 percent); have a poor credit rating (54 percent compared to 8 percent), and not save for retirement (71 percent compared to 42 percent), according to the 2008 book, "ADHD in Adults: What the Science Says" by Russell A. Barkley, Kevin R. Murphy and Mariellen Fischer."Impulsivity is a huge problem," says Michele Novotni, a Philadelphia psychologist and chair of the ADHD Awareness Coalition, a group of organizations that educate the public about the disorder. Roughly 1.7 percent of adults have a form of ADHD classified as severe, and Novotni has seen her share. One of her clients (Novotni also works as an ADHD coach) went out to buy groceries, got distracted on the way by a sign advertising an open house, and returned sans groceries, but with a contract on the house. Another client went to jail because he couldn't face filing his federal income tax returns or paying his taxes. Another, who earned over $100,000 a year, lived for two weeks without electricity or running water because he forgot to pay the bills and was too embarrassed to call the utilities and sort it out.
SOME SYSTEMS HELP But the situation is not hopeless, even for those in the "severe" category. Experts like Novotni say there are techniques that ADHD sufferers can use to help them get on top of their finances and keep the lights on. Here are their suggestions.
- Develop a bill storage system that is simple, consistent and visible. "Find a home for it where it does not move," says Lynne Edris, of Harrisburg, Pennsylvania, who coaches people who have ADHD and ADD
(The writer is a Reuters contributor. The opinions expressed are his own.)By Chris TaylorNEW YORK, June 9 It seems America's youth have found a hero, and he is 84 years old. For those aged 34 or younger, their No. 2 favorite stock - behind only mighty Apple Inc - is none other than Warren Buffett's Berkshire Hathaway Inc. This is according to new data from the brokerage TD Ameritrade, which took a snapshot in May of the individual equity holdings of every one of its retail clients (not including mutual funds and exchange traded funds, which themselves hold baskets of different securities). When it came to picking individual stocks, the results showed a generational difference. Millennials, who are pegged as tech-obsessed upstarts, favored the stocks of their own time. Aging baby boomers, who are stereotyped as stubbornly set in their ways, and Generation X, which is stuck in the middle, mostly favored what they know best, that is, dividend stocks. Among the top picks for young adults aged 34 and younger: Apple, which accounts for a whopping 11.7 percent of their equity holdings; Facebook Inc, at 1.9 percent; electric carmaker Tesla Motors Inc (TSLA), at 1.1 percent; and Chinese e-commerce giant Alibaba Group Holding Ltd, at 1.1 percent. For all those aged 35 years and older, Apple reigns supreme in their portfolios as well, with a share of 9.4 percent. Other popular stocks include General Electric Co, at 1.7 percent; AT&T Inc, at 1.4 percent; and Exxon-Mobil Corp , at 1.4 percent. No mystery there: Follow the dividend.
"Older clients tend to search for higher yield," said Nicole Sherrod, TD Ameritrade's managing director of trading, since dividend-paying stocks provide a steady income stream as boomers start easing into retirement."So you see energy companies like Chevron, and healthcare names like Johnson & Johnson, and telecoms like Verizon, all of which they are very familiar with and have been investing in for years."For the youngest generation, however, it is all about what is hot now."It's a demographic that is very much into tech, so it's not shocking that it tends to skew much higher in their portfolios," said Sherrod.
"Take something like Tesla: It's something hot that millennials covet, and although they may not have the purchasing power to buy the car yet, they can certainly buy the stock."WHO HAS IT RIGHT? But the underlying question: Do America's respective generations have their equity mixes right? Or is some rebalancing in order?
To find out, Reuters took the trove of TD Ameritrade data to Patrick O'Shaughnessy, a portfolio manager with Stamford, Connecticut-based O'Shaughnessy Asset Management and author of the book "Millennial Money: How Young Investors Can Build a Fortune."His No. 1 concern for both generations: Back off on the Apple, guys. Not because of poor fundamentals, but because of serious overweighting."Those Apple percentages are crazy high," O'Shaughnessy said. "In comparison Apple is around 4 percent of the S&P 500, so that is a huge individual position for both age groups."O'Shaughnessy also warns millennials against loading up on the latest sizzling tech stock, say Alibaba, and advises them to look hard at underlying valuations. In many cases price-earnings ratios have shot sky-high, and just do not represent smart buys. If millennials remain determined to invest in the sector, they should instead look at stodgier tech names like Microsoft Corp, he said. With proven revenue streams, stock buyback programs, and growing dividends, tech's old guard should prove safer harbor if market storms hit. O'Shaughnessy's final tip for investors: Look abroad. Since the U.S. market has "killed every other market for five years," that likely means many investors are now overweight in American stocks. As a result, bulking up your portfolio with more international names would be wise. Whether it comes to millennials, or Gen Xers, or boomers, each generation seems to be investing in what it knows. Generally speaking, that is a good thing - and happens to be a favorite principle of Warren Buffett himself.