Editor's Note: The guest commentary below was written by longtime Hedgeye "Power User" Jeff Tyburski, Founder of Your Financial Sherpa. Jeff began his career as an engineer for 13 years, then worked as a senior analyst and portfolio manager for over two decades. He graduated from the University of Rochester where he earned an MBA in finance and is a CFA Charterholder. 

QUADs, PODs …How About SQUADs? → Savings-QUADs For Parents Helping Their Kids - AdobeStock 48220497

Savings-QUADs Help Parents Help Their Kids

Takeaway: Attention Hedgeye subs who are parents or grandparents, young people aren’t saving enough. Even worse, many are in no position to start, saddled with college debt or underemployed. Since you can’t invest if you haven’t first saved, we need a roadmap to help prepare young adults for their future. Here is the first in a series of articles to help parents help their kids with money and broader life skills.

Hedgeye delivers a process-driven investment platform with a mission to engage and educate a self-motivated subscriber base. At the heart of Hedgeye’s macro framework are the QUADs – a full economic cycle investing tool.

But since you can’t invest if you haven’t first saved, how about a full life cycle savings tool?

Introducing SQUADs (Savings-QUADs):

  • The two most consequential factors driving savings are Desire and Ability.
  • Desire is willingness; having the mindset, discipline, and motivation to save.
  • Ability is being in position to save (e.g., with a good job and little debt) and having a personal process to save (e.g., the life skills to succeed).
  • Plot Desire on the y-axis and Ability on the x-axis.
  • The results are four possible combinations (4 Savings-QUADs).

QUADs, PODs …How About SQUADs? → Savings-QUADs For Parents Helping Their Kids - squad1

QUADs, PODs …How About SQUADs? → Savings-QUADs For Parents Helping Their Kids - squad2

SQUADs as a Launching Pad for Broader Educational Content on Saving Money:

The SQUAD framework can serve as a conversation starter for those who are already familiar with Hedgeye’s QUADs. SQUADs can provide a platform and opportunity to subsequently deliver a broad breadth of educational content on saving money.

Content to Boost Desire & Ability to Save:

The SQUADs specifically introduce and highlight the need for financial literacy educational content that boosts both the Desire and Ability to save; content that Hedgeye subs, who are parents or grandparents, can share with their kids in open family conversations. Future articles will provide story-based educational content in a framework using these four buckets:

  1. NEED to SaveContent that creates and encourages a sense of urgency over the NEED to save. Start young to be ready for your future.
  2. WANT to SaveContent that motivates and excites people to WANT to save (i.e., because money grows). Start young to give money the most time to grow.
  3. POSITION to SaveContent that helps people stay in POSITION to save by avoiding obstacles to saving like debt and underemployment. Start young to be ahead of problems and to learn to earn more.
  4. PROCESS to SaveContent that helps develop a personal PROCESS to save, including the right mind set and method (see prior article on ‘saving first’) to make daily decisions to save and build wealth. Start young since it is easier to form good habits early in life than change bad habits later.

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About Your Sherpa

Your Sherpa teams up with parents to bring financial literacy educational content to kids and young adults. Your Sherpa has a unique approach to teaching financial literacy, offering a roadmap from start to finish (a true personal process with the life skills and mindset to succeed). Click here to visit the website.