The Banking Executive - Decemebr 2021, Issue 156

The Butterfly Wealth Effect Small decisions that you make every day can be the difference between you owning a luxurious house while running the business of your dreams and renting a modest apartment while working at a low paying job. These decisions start off small; they are typical daily ones that eventually compound over time to make one giant changing your life. In order to dive into how this works. Let's take a look at the cases of two average Millennials. These Millenni- als have a net worth of about $10,000 each. They both have an av- erage income of $39,000 per year, they are both likely working in the service industry. They spend roughly $1,100 a month on rent, $350 on groceries, a few hundred month on health insurance, their monthly utili- ties are about a $150 per month and they have a series of other fixed ex- penses, like internet, taxes, car pay- ment, student loans, phone bill and other necessary expenses. At the end of everything these two typical Mil- lennials usually have a few hundred dollars a month left over to spend on whatever they want. In our case, we're going to say that each of these Millennials has about $300 per month in excess money. So what are they going to use the Money for? The Butterfly wealth effect can be best explained by the small money decision that are made today and could have a dramatic effect on a person’s life for years down the road. ISSUE 156 DECEMBER 2021 the BANKING EXECUTIVE 13