Millennials Who Are Thriving Financially – 10 Tips
If you are a millennial who recently landed their first job, congratulations. You are probably quite happy to be getting your first paycheck. You have already planned the things you will purchase with the money. However, with money coming in every month, it can be easy to forget about financial success. Although millennials are more educated, they have to be wary about the fragile nature of the economy. Here are some of the tips that we at RunRex think you can utilize to ensure you are financially thriving as a millennial.
Place your money somewhere it will grow
If you want to save, keep in mind that money is a bad leader but a good follower. If you want to thrive financially, do not work too much for money; let the money work for you. To achieve this, simply place it somewhere it will earn some income. You can opt to put your money in a bank. However, that money will lose value with time due to inflation. You should invest it elsewhere such as government bonds, the stock market, and government bonds.
Live frugally
Amongst millennials, there is a lot of pressure to live an expensive life. Friends or how you were brought up could influence this. Keep in mind that there will be time to live that high-end life when you have the money. However, it cannot be right now. If you try it now, you will find yourself in debt from which there is no escape. If you live at home, that should not be an excuse for you to misuse all your earnings. Save the cash and use for better things later on.
Examine your priorities
Right now, the world may seem like a big place. However, you need to take time and examine what you should prioritize. For instance, if you love traveling, spend money on a trip. Upgrading your electronics with no real financial gain is a waste of time.
Do not follow everyone else
If everyone is buying new things and going to new places, you may find yourself under pressure to do it too. However, you should know that your priorities are different and they may not rhyme with those of your friends. Right now, you must prioritize saving as much of your meager earnings as you can.
Utilize the 50-30-20 approach
When you save, a good principle is to allow a given amount that you will save each month instead of saving what remains after you spend. With 50-30-20, half of your salary will go to expenses. The other 30 percent should go to your interests. The remaining 20 percent is what you save.
Create an emergency fund
You are still young and healthy. However, that could change quite fast. You need to have a fund which you can dip in when you experience an emergency. This way, if you experience something that needs quick cash, you will not turn to begging.
Work on your credit score
Having a good credit score in the spice of life; with a good credit score, it can assist you to make good use of your finances. For instance, if you are ever in an emergency, you can take a small loan without worrying about the interest rates. To do this, simply pay bills in good time, avoid maxing out credit cards, and keep old credit cards open. There are tools online that help you monitor your credit score.
Run your finances in the same way as your social life
You probably have a social media. To do that, you created a separate email for junk mail on various sites so that your inbox is not flooded by mail. Create a separate email and a calendar for your finances. This way, you do not miss any payments and discover deadlines in good time.
Examine your taxes
In life, you cannot escape death and taxes. Since you will never escape taxes, you should understand them. This is not fun but if you know how much you pay, you can take advantage of it. It does not mean you need to know every aspect of taxes. However, ensure that you have some basic understanding of how taxation works.
Save for long-term goals
As a millennial, it can be easy to have only short-term goals. However, it is never too early in life to start having long-term goals. Have goals that stretch out ten years into the future and start saving now. It may seem far away but it will be much easier when it arrives if you have saved.
For instance, you could start saving for that high-end car that you want to have right now. In future, your life will be quite easy compared to others with no plan right now. It also means that you will have a great credit score when the time comes, which gives you access to more finances.