Interviewees:
Kyla Scanlon: Author of “In This Economy?” and focuses on financial education for young people, operating a personal newsletter.
Christine Benz: Director of Personal Finance and Retirement Planning at Morningstar Inc., author of “How to Retire: 20 Lessons on Happiness, Success, and Wealth.”
William Bernstein: Neurologist and investment advisor, author of “The Four Pillars of Investing” and “How Trade Shaped the World.”
Investment Anxiety for Young People: From Diversifying Skills to Rational Risk Diversification
Kyla Scanlon pointed out that this generation of young people has low confidence in the economy. From the impact of the pandemic to high inflation, rising house prices, and unstable careers, she advised young investors to avoid a single career development path and strengthen and diversify their skills, especially in AI and economic analysis, to be prepared for future changes in the situation.
She also revealed that the investment behavior of Generation Z often oscillates between being “safety seekers” and “digital gamblers.” Some people excessively risk investing in meme stocks like GameStop or cryptocurrencies, while others completely avoid the stock market. In response to this, she emphasized, “Generation Z should ensure financial stability before starting to invest.”
Diversifying assets is the foundation of risk management, including allocation in utilities or growth-oriented tech stocks, and valuing the power of “compounding.”
Asset Allocation for Middle-aged and Retired Individuals: Prudent Global Diversification, Emphasis on Inflation Defense
Christine Benz suggested that people in their 30s to 40s should differentiate between short and long-term goals, make good use of long investment periods, and “embrace the market volatility” that brings entry opportunities. For those over 50 and approaching retirement, they should establish a low-risk asset pool for 7 to 10 years to reduce exposure to volatile positions and hold enough cash or bonds to deal with market fluctuations.
She particularly emphasized the current global trend of “deglobalization” and trade barriers, which has led to more differences in global market performance. Investors should increase their allocation to “non-U.S. markets.” In the face of inflation risk, she also recommended including inflation-protected bonds (such as TIPS or I Savings Bonds) and a bond ladder to preserve purchasing power.
Don’t Chase Political Trends in Investment: Focus on Cash Flow and Patience as the Key
William Bernstein reminded that investment behavior should not be based on policies or political news because market reactions and expectations are almost unpredictable. He used the example of the night of Trump’s first election, where the market initially fell and then rebounded, proving that policy variables cannot predict short-term market trends.
He advised individuals to measure their “burn rate,” which is the proportion of funds withdrawn from the investment portfolio each year. For investors with a low burn rate (e.g., 2%), the financial risk is low. But if the burn rate is as high as 4%, cautious allocation is necessary to avoid excessive reliance on the stock market.
At the same time, although he considers young people’s human capital as a stable asset suitable for more aggressive investment strategies, he remains pessimistic about the future. He believes that investors should establish an emergency fund and be mentally prepared for possible unemployment in the next 6 to 8 months.
Tariffs and AI: The Two Forces of Long-term Economic Restructuring
All three experts pointed out that the tariff policies proposed by Trump may push up inflation and disrupt the global supply chain, which is detrimental to the economy in the long run. Bernstein even warned: “Although the tariff policy in 1930 did not directly cause the Great Depression, it indirectly led to World War II.”
On the other hand, the three experts also agreed that AI is a promising industry for investment and careers in recent years, especially in the early growth stage with high return potential. However, Bernstein believes that this will not destroy the job market: looking back at history, the fear of technological unemployment in the past (such as bank tellers or switchboard operators) did lead to direct job losses, but it also created more new opportunities. Young people should maintain their ability to learn and adapt and not panic about AI replacing human jobs in the future.
Consensus among Experts: Stability and Flexibility are the Key to Weathering the Storm
Faced with the challenges of tariffs, AI, and geopolitics, the three experts unanimously emphasized that “young people should focus on skill improvement and long-term investment; middle-aged individuals should consider risk management and global asset allocation; retired individuals should focus on cash flow and hedging.” It is well known that diversifying investments, diversifying skills, and owning inflation-resistant assets are the unbeatable principles to navigate through the waves of tariffs, technology, and policies. This economic transformation wave is not necessarily a risk; it could also be an opportunity as long as you are prepared.
Risk Warning: Cryptocurrency investment carries a high degree of risk, and its prices may fluctuate dramatically, resulting in a potential loss of the entire principal. Please carefully evaluate the risks.