January is a great time to hit the reset button and an estimated 41 percent of Americans say they usually make a resolution or two to mark the beginning of the new year.  Not surprisingly, resolutions involving money are often at the top of the list. According to LendEDU’s Financial Resolutions for 2017 Study results, 53 percent of Americans are focused on saving more, and 14 percent specifically said that saving for retirement is on their agenda. 
Among 20- and 30-somethings, a little goal-setting could be a good thing, particularly for their investment outlook. While 48 percent of millennials are open to the idea of investing, 46 percent of young adults think it’s just too risky.  The end result? They’re overwhelmingly allocating the bulk of their portfolio to cash and sacrificing long-term investment growth in the process.
If you’re part of the millennial crowd and you’ve been sticking with uber-conservative investments, now’s the time to turn it around. Adopting these five resolutions as part of your investing strategy could pave the way to higher returns and a brighter financial future.
- Get Started If You Haven’t Yet
From a generational perspective, millennials are the most likely to drag their feet when it comes to investing. Roughly one-third of 18 to 35-year-olds say they invest regularly, compared to 51 percent of Gen Xers and 48 percent of Baby Boomers.  A lack of cash is cited as the number one reason for holding back among both younger and older millennials who aren’t investing.
The problem with that assumption is that you need big bucks to make a foray into the stock market and that’s simply not true. For example, there’s no minimum required to open a Motif account you can begin investing in motifs with as little as $300. That’s the equivalent of spending $10 a day on lunch for a month.
Bottom line, becoming a smarter investor in your 20s or 30s begins with taking the first step. Resolving to do that can be a little intimidating but you’ll thank yourself once you get over the hurdle.
- Be Consistent
Once you’ve gotten the ball rolling, you have to keep the momentum going. Investing a few hundred dollars once or twice a year isn’t going to cut it if you really want to gain some traction in your portfolio. Choosing a specific amount that you’re comfortable investing on a regular basis and sticking to a schedule makes it easier to capitalize on the power of compound interest over time.
Here’s an example of just how valuable that can be. Let’s say you’re 25 years old and you open a Roth IRA through Motif with an initial investment of $1,000. You schedule automatic monthly contributions of $200. If you follow that same plan until age 65, you could have over $527,000 saved for retirement, assuming a 7 percent annual return. 
If you skipped out on the automatic contributions, however, and just chipped in an extra $300 every three months, you’d have $271,000 instead.  As you can see, taking a disciplined approach and staying the course can really pay off, especially when you have a longer time horizon in which to invest.
- Be Mindful of Taxes
Four out of five millennials admit that the words “tax filing” sends a chill down their spines, and 13 percent say they worry most about paying too much in taxes.  As a newer investor, looking for ways to minimize your tax liability is a must if you’re concerned about ending up in hock to Uncle Sam.
There are two ways to do that. The first is to invest through tax-advantaged accounts, such as your employer’s 401(k) or an individual retirement account. The other is to choose tax-efficient investments if you’re trading in a taxable account. That’s because the sale of an asset for more than what you paid for it triggers capital gains tax.
The short-term capital gains tax rate applies for investments you hold less than a year. The more favorable long-term capital gains kicks in for investments you’ve held longer than that. Choosing investments that result in fewer capital gains events can help you keep more of your earnings in your pocket over the long haul.
- Make Diversification a Priority
Diversification is a critical element of any investor’s portfolio and unfortunately, it’s something that millennials are often clueless about. According to a study from AMG Funds, 72 percent of millennials said a portfolio was diverse enough as long as it included a broad range of stocks. 
While stocks are an important element of a well-rounded portfolio, you don’t want to make the mistake of thinking they’re a one-size-fits-all solution. Couching your bets with safer investments, such as bonds, is important for balancing out risk. At the same time, moving into other asset classes, like real estate, can increase diversification while offering a built-in hedge against the market.
The lesson here? Putting all your eggs in one basket could backfire so be sure that the investments you’re choosing don’t give your portfolio a cookie-cutter feel.
- Keep Emotions In Check
When the market dips and dives, that can send your emotions on a rollercoaster ride but the last thing you can afford to do is make irrational decisions with your investments. Warren Buffett summed it up best when he said: “Be fearful when others are greedy, be greedy when others are fearful.”
The message is pretty straightforward. When you see other investors in a mad rush to sell off investments because of market fluctuations, pause before you hit the panic button. The opposite applies when you see investors making a mad grab for a particular stock or mutual fund. Jumping on an investment because you fear missing out could leave you feeling broke if it doesn’t pan out.
One of the most important things to remember as a younger investor is that you have time on your side. That, and that the market tends to move in cycles. Looking at the bigger picture is something you may want to think about doing more of for a healthier portfolio in 2017 and beyond.
 Statistic Brain. “New Year’s Resolution Statistics,” January 1, 2017.
 Rathmanner, Dave. “Financial Resolutions Survey & Report 2017,” LendEDU, December 5, 2016.
BlackRock. “2015 BlackRock Global Investor Pulse Survey” October 22, 2015.
Bankrate. “Bankrate Money Pulse Survey” June 2016.
Bankrate. “IRA Calculator.”
NerdWallet. “Millennials Fear Filing Taxes More Than Most Americans, NerdWallet Survey Finds,” February 17, 2016.
AMG Funds. “Millennial Mentality,” June 2016.