Financial literacy is vital for individuals of all ages, but it becomes a must-learn thing for millennials.
As a millennial, I tend to receive endless financial advice from older people. However, most of those
counsels don’t appreciate the unique position and generation we are in.
Our financial problems are distinct because we’re currently living in the digital age. Most of us are
crammed in cities, a lot of us are educated, and we tend to stick too long under our parent’s
paycheck. Financial management can be a daunting task, particularly when hunting for a job,
studying in school, or starting life from scratch. Below are smart financial tips that guide my financial
journey as a millennial.
A Roommate or Head Home
The financial impact of renting an apartment is well-known. Luckily, my first job was in my home
town, where I lived with my parents. Unlike my friends who had rented luxury apartments, I never
needed to pay rental bills. With that said, I occasionally chipped in to offset other bills. Come to
each end of the month, I had more cash at my disposal. After moving out of my parent’s home, I
hunted for a house together with my life-long pal. We had resources available to us, from the
best buy to let mortgages to the money we had saved beforehand, and it served us well.
We moved in together and co-shared every bill, including rent and utility bills. This arrangement
enabled each of us to save some cash.
Save Early
During our 20s, retirement might seem like a distant memory, but it’s inevitable. And the best way
of planning for our sunset years is by saving today. The earlier we save, the more time we have to
grow this money.
When we cease to work, or during emergencies, we will have enough backup cash to tackle these
unexpected occurrences. We don’t need to save lump sums. As new entrants in the workforce, most
of our salaries are at minimum wage. We can set a small percentage (about 10%) for savings and the
rest on other things.
Prioritize
Some of us get jobs or errands to run after college or during summers. What’s interesting is that the
Internet has brought and nurtured the freelance culture. We can now work several jobs in the
comforts of our homes. With employment comes weekly or monthly compensation. We sometimes
feel overloaded with cash, and the feeling of overspending kicks in.
When working, it’s important to set financial priorities. It might mean identifying the most pressing
financial needs and solving them first. When I first started working, I used most of my salary to
offset my student debt, pay car bills, and rent. By prioritizing these needs, I had little cash at hand
that I rarely misused.
Be Cautious of Credit
When I got my first credit card, the feeling was a financial breakthrough and a quick solution to my
early financial troubles. Were it not for my dad’s intervention, I would have been deep into money
issues. This is because my credit card debts, together with my student loan debt, were piling up at
an astonishing rate.
Every young person needs to build their credit responsibly. We can start by getting a credit line that
doesn’t supersede our income streams. The interest rates charged should also be insignificant. We
can gradually increase the credit line once we are capable of meeting our credit payment. This is the
only way we can build our credit scores and increase our chances of getting credit for future
investments.
Seek Help
Transitioning from being under our parent’s care to our survival is in no way straightforward.
Handling financial decisions is particularly tricky at a young age. However, when we face difficulties,
it’s necessary to seek help from parents, friends, or coworkers. The support doesn’t necessarily
translate to monetary aid, but it could be how we can navigate a financial situation.
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