6 Financial Tips For Millennials of Any Age
3 min. read
Millennials are an incredibly diverse group, ranging from 25 to 40. This means if you randomly picked a millennial, you could end up with someone a few years removed from college or someone with a family and well into their first mortgage! Below are a few financial tips you should find helpful regardless of your age.
1. Start Building Retirement Savings Now
The best time to start on retirement savings is right now. The reality is social security will likely not be enough to sustain your lifestyle when you enter retirement. Supplementing social security income with ample savings will ensure you’re able to enjoy retirement while not worrying about having enough money to cover your bills.
Whether it’s independent investing, contributing into your employer’s 401(k) plan or setting up a savings account, money saved is money that will come in handy later in life.
Consider consulting with a financial advisor to see what options you have to grow your money.
2. Create and Maintain an Emergency Savings Fund
Life is full of unexpected surprises. Car troubles, medical debt and even employment uncertainty can pop up with no notice. Having an emergency fund to fall back on can make these problems easier to manage. As for how much to save in your fund, estimates vary. We usually recommend anywhere from three to six months’ worth of expenses saved.
For more on building an emergency savings fund and budgeting, read one of our previous budgeting blogs.
3. Start a Budget and Tackle Debt
The only way to achieve financial goals like saving for retirement is to start with a budget. A budget is great for determining how much money you’re bringing in every month and how much is being spent on expenses. You can also examine which of those expenses are recurring and most important, like your rent/mortgage, groceries, gas, insurance, etc., as well as those that could be considered luxuries.
There are many budgeting strategies, from zero-based budgeting to the 50/30/20 method. Read about each in our budgeting strategies blog to find one that suits your needs.
4. Cut Expenses
With your budget ready, you can see the kind of expenses you’re incurring and identify areas where cutting may save money. Do you have a gym membership you’re not using or a streaming service you haven’t logged into in months? While their monthly cost might not be too bad on a month-by-month basis, you may be losing hundreds of dollars by the end of the year. You could also not be eating at home enough, resulting in you consuming your dollars by eating out multiple times a week.
5. Tackle Debt
As of September 2021, the average American is $92,727 in debt. This debt can keep many Americans and their families from achieving their financial goals, like buying a new home or saving for retirement, and even personal goals like travel and starting a family. This is why it’s in your best interest to tackle debt as early as possible.
This is easier said than done, and it requires a lot of careful planning and financial discipline. Consider employing a more aggressive budgeting/debt-paying strategy. While the sacrifices might be great, the relief of being debt-free is worth it.
6. Improve Your Credit Score as Much as Possible
Credit scores are one of the most important metrics financial institutions like Florida Credit Union look at when evaluating loan applications. A credit score is a number that tells lenders the kind of borrower you are and how likely you are to pay back a loan. The higher the number, the more trustworthy you look as a borrower.
With a high credit score, you’re seen as less of a loan risk. This lower risk is typically reflected in more favorable loan terms for higher scores, such as lower interest rates. Saving money on interest will free up more cash for the other financial goals listed above.
If you’re wondering how to improve your score, there are two simple things you can do to see a positive change.
We’re Here to Help
Florida Credit Union is not just a place where you open a savings account! We’re here to be your financial partner for life, through car loans, mortgages, and more. Visit a branch or speak with one of our member service representatives about your financial needs.