4 Things Gen Z and Millennials Should Never Sell Before They Reach Full Value
Written by
Vance Cariaga
Edited by
Ashley Barnett
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Gen Z and millennial Americans get pretty high marks for their financial habits, despite a series of economic headwinds that have included the Great Recession, COVID-19 pandemic and soaring inflation rates. Among other things, Gen Zers and millennials have pioneered the use of digital financial tools, embraced the gig economy and largely shied away from wasting money on things they don’t need.
There’s not much data on how well the two generations do when it comes to not selling assets before they peak in value. But it’s not uncommon for young people to make that mistake. When you are short of money and long on bills, it’s easy to seek quick cash by selling items for much less than they’re worth.
The best policy is to figure out some other strategy to get cash — such as working a side hustle. Waiting to sell items often leads to better profits and more financial security down the road.
Here are four things Gen Z and millennials should never sell before they reach full value.
Stocks
When you need money, it’s tempting to unload stocks. But you’re almost always better off playing the long game rather than looking for the quick payoff. Historically, the stock market trends towards growth. The S&P 500’s annual rate of return has been about 10% since its inception in 1957, SmartAsset reported, and there’s no reason to think that won’t continue into the future.
You should especially not sell stocks because of a sudden change in price. That’s an emotional reaction that hardly ever works out in your favor. You also shouldn’t sell a stock just to save money on taxes, according to Motley Fool.
Your Home
Unless you have a compelling reason to sell your home, such as moving to another city or needing more space for a growing family, you’re almost always better off holding on to it. Home prices tend to move higher over time — especially lately. This not only means the home you want to sell will go up in price. It also means the home you want to buy has already gone up in price. You should especially not sell if you have locked in a low fixed mortgage rate.
Collectibles
Among all the generations, high-net-worth millennials and Gen Zers in the U.S. have the most interest in collectibles, according to a Bank of America study. While their interest mainly involves watches, jewelry and wine, others have shown interest in everything from coins and sports cards to art and toys. It’s difficult to judge when collectibles have hit their peak value, but one thing Gen Zers and millennials don’t want to do is sell them too early because you could be leaving a lot of money on the table.
For example, a box of Upper Deck Exquisite Collection Basketball cards caused quite a stir when they retailed for $500 a box in 2003-04, according to The Cardboard Connection website. But certain premium cards from that series now sell for a lot more money than that — including a professionally graded Lebron James signed rookie card that sold at auction for more than $1.5 million three years ago, the Bleacher Report reported.
Bonds
As Investor.gov noted, if you hold a bond to maturity, you get back its face value. But if you sell a bond before it matures, you could get a much lower amount. This might happen if interest rates have risen since you bought the bond.
In addition, if you want to sell the bond before it matures, you might have to pay a commission for the transaction, or your broker could take a “markdown.” According to Investor.gov, a markdown is an amount (usually a percentage) by which your broker reduces the sales price to cover the cost of the transaction and make a profit on it.
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