Are you a millennial who’s credit card billings piling up while bank accounts cry zero balance? Struggling to juggle your social life with saving cash? The good news is: you are not the only one.
When it comes to managing finances and securing a solid overall financial position, a lot of millennials are falling short. The lifestyle creep happens and tempts them to spend more and more money on unnecessary things.
As a Millenial yourself, I’m sure you can relate to it. So it comes as no surprise if many Millenials have financial stress. According to Haley Ross, a millennial adviser at Bank of America Better Money Habits, at least a third (35%) of Millennials say that not having enough money to save is their top financial stressor.
The biggest contributors to this phenomenon are student loans, auto loans, and credit cards. If this trend continues, you should start saying goodbye to buying your own house. You’ll be lucky to have any spare money to save at the end of every month.
Financial Crisis: How Millennials Can Deal With It?
With some solid financial management, beating your financial stress doesn’t have to be nightmare-inducing.
There are two ways to solve your financial issues you can either raise your income, or you can lower your expenses and save your money. In this article, we’ll talk about the second option, which is how you can lower your monthly expenses.
Here are 21 actionable financial management tips and tricks for millennials:
- Don’t buy a house with a mortgage unless you’re debt-free, and the monthly payment is not more than 28% of your income. Otherwise, it’s better to rent.
- If you’re comfortable with living with another person, get a roommate to share the rent cost.
- Failing all the above, consider moving back in to live with your parents.
- Apply for scholarships to cover your education costs. Scholarships are a numbers game, apply as many as you can to increase your chances.
- If you really have to take a student loan, take federal loans because they usually offer payment deferment or rescheduling options, unlike private loans.
- Consider selling your car to save money on loan interest, gas, parking, and maintenance. Use the money to pay off your other big debts like student loans. Use public transportation to commute instead.
- Share a ride with someone to get around. You can ride with a relative, neighbor, friend, or use rideshare apps like Uber.
- Ride a bike or walk to your school or workplace.
- Do an energy audit in your house to determine which areas can be cut down.
- Make a habit of turning off lights and unplugging electrical appliances after use.
- Install a programmable thermostat to automatically set your house cooling and heating temperature when you’re away or asleep.
- Don’t eat out too often. Instead, prepare your own meals for the whole month.
- Rather than going to coffee chains, brew your own coffee.
- Consider canceling your gym membership. Instead, do free workouts like running around the block or doing push-ups.
- Cut your cable. There’s no point in wasting your money to pay for the content you don’t watch. As an alternative, consider streaming services like Netflix and Hulu. They cost less, plus you get to choose the content that you want to watch and when you want to watch it.
- Limit your social media use to avoid being influenced to buy unnecessary things.
- Instead of going out, invite your friends over to your house. You can do cheaper yet fun activities together, like watching movies, playing games or barbecuing.
- Shop with a predetermined budget and stick to it.
- Buy high-quality stuff instead of cheaper knock-offs. It’s better to spend $150 on jeans that you can wear 300 times than to spend $15 on jeans that you can only wear 5-10 times.
- Shop at thrift or secondhand stores once in a while. If you’re lucky, you’ll stumble on some good stuff at a much lower price.
- Sell your unwanted/used clothes in a garage sale or eBay. It’s a great way to make extra money while also getting rid of your clutter.
Building Your Savings Doesn’t Have to Be Stressful
Taking the time to manage finances isn’t something that everyone is keen to do, especially for millennials. As a millennial, your spending habits are bound to be unhealthy. You easily tend to lend themselves a spiral pit of debt.
However, this kind of situation can be effortlessly avoided if you make an effort to learn more about financial management. It won’t only help manage your spending and saving way better, but also give you the much-needed insight into the world of investing their wealth– which your future self will thank you for.
So, if you’re a Millennial and having a hard time saving or facing financial issues (debts, student loans, etc.), the best way to start is by lowering your monthly expenses. Remember, the most crucial rule of financial management is: start now and start somewhere.
Andre Oentoro is the founder of Breadnbeyond, an award-winning explainer video company. He helps businesses increase conversion rates, close more sales, and get positive ROI from explainer videos (in that order).