Although they are often accused of being the snowflake generation, millennials have certainly not had things all their own way. They have grown into adulthood at a time of economic crisis and slow recovery, where high levels of debt are the norm and much uncertainty lies ahead. This brings with it a huge range of challenges, particularly when it comes to managing their money.
Being broke and in your 20s is difficult enough as it is, but at least a good grounding in personal finance can help you make the most of your situation and stay on top of your finances. But what do millennials need to know? Here’s our guide…
- Learn how to save
Millennials are often accused of being bad savers, but they face the prospect of being the first generation that has been less financially secure than the generation before. So in many cases, they simply don’t have much money to save. However, that doesn’t mean it’s not still possible to plan for the future. Little and often is the key. These tips from the short-term lender Wonga SA can help you save on a shoestring.
- Check your finances regularly
When your bank balance fills you with nothing but dread and fear, the temptation is to bury your head in the sand. However, ignoring your finances will only exacerbate your situation and make any money problems you do have worse. By keeping a regular eye on your bank account, you can begin to identify where your money is going and potential savings you could make. How you fix the problem is up to you – the difficult part is admitting you have one.
- Make some cuts
Whoever you are and however much you earn, there are always some impactful cuts you can make in your budget; the secret is to find something that won’t disrupt your lifestyle too much. Probably one of the most repeated pieces of budgeting advice out there is to cut down on the cost of coffee and lunch. While it might not be the most exciting advice you’ll ever hear, taking lunch to work with you three or four days a week is an example of a simple way to save a considerable sum by the end of the month, and importantly, it’s also relatively painless.
Other simple cuts you might choose to make include cancelling your subscription TV service or buying alcohol to drink in with your friends rather than always going out.
- Don’t get a credit card if you don’t need one
Millennials are often told to get a credit card to build their credit rating, but this also puts a huge amount of temptation in their way. If you don’t need a credit card to get by then our advice is not to get one. There are plenty of other ways you can build your credit rating. For example, if you rent a property then simply paying your bills on time will help to boost your credit score. Some landlords even report regular rental payments to the credit bureaux. Here are a few more tips to help you build your credit score without a credit card.
What steps have you taken to improve your finances as a millennial? Please share your tips with our readers in the comments below.