The majority of the working population today are millennials, also known as the Gen Y. They are the most well-educated yet financially challenged generation today. It’s why many millennials tend to experiment to get the best possible ways to save money.
Many millennials have achieved success at a young age. One reason for this is that they manage their finances better than previous generations. Here’s how Gen Y manages their finances and increases their chance of achieving their financial goals effortlessly.
Budgeting the Digital Natives Way
Budgeting has always been the number one most effective way of saving money. It has been on the financial rule book since previous generations. However, budgeting has become more achievable and convenient for this generation, thanks to every budgeting app available today.
Many apps can help track income and spending in an organized way. Instead of dealing with a lot of paperwork when tracking the budget, millennials use only one app that can do everything to make their budgeting successful.
They also follow the 50/30/20 budget rule, and they are strict about it. The rule is simple. You can only spend 50% of your earnings on necessary things, like food, rent, utility bills, education, insurance, and medication.
The 30% will go to your wants such as clothes, travel, and any lifestyle-related things. After that, the remaining 20% should go to savings.
Works Multiple Jobs
Millennials are always worried that one job isn’t enough to cope with their expenses. As a result, they tend to work multiple jobs. Another reason why millennials opt to work multiple jobs is because they want to learn new skills and acquire experience.
There are many things that they consider, especially after graduation. First is the student loan they need to pay back. The second is the lifestyle they want to live. Even though millennials may seem materialistic and spoiled, they know how to work hard to get what they want.
Utilizes Fintech for Financial Management
Fintech has become highly popular since the COVID-19 pandemic hit. Many individuals carry out transactions online through the bank’s app or website. And millennials are the most significant portion of people who use fintech in their daily lives.
Aside from online bank transactions, digital wallets are also trendy nowadays. Using these fintech products makes tracking all your spending, income, and transactions effortless. The convenience provided to the consumer is also unparalleled.
By using these fintech products and budgeting apps, millennials have managed their finances effortlessly.
Invests in Health Insurance
Compared to any other generation, millennials are considered the generation that takes care of their health differently. Many think that Gen Y, along with Gen X, is the generation with the most unhealthy lifestyle, such as smoking, drinking, and unhealthy food choices.
But would you believe that Gen Y is also the most health-conscious generation? When millennials reach their thirties, health becomes an issue of concern increasingly.
Because of this, millennials include health insurance as a necessity for their overall well-being. It’s their way of protecting their health as well as their finances.
Wiser in Acquiring Debts
Even though millennials make up the majority of the debt acquired in the United States, they are still considered wiser when it comes to borrowing money. They don’t acquire debt for unnecessary reasons. They say millennials hate debts and are not fond of credit cards.
It’s one of the reasons why this generation manages their finances successfully without any effort. If they go into debt, it’s because of something important like a mortgage, a car loan, or emergencies.
Many millennials believe that financial success means that you are debt-free. Without a lot of debt to pay, you’ll be able to save more. Plus, living without a credit card will help you prevent overspending.
They are also known to be diligent in paying back their debts. Millennials make it a priority to pay back what they owe within the agreed time. As a result, their debt won’t accumulate, and they’ll never have to pay substantial interest rates and additional fees for late repayment.
Follow the Millennial Way of Managing Your Finances
By looking through the five ways a millennial manages their finances, you can tell they are effective. If you have been aiming to save more for the past years yet still failed, maybe it is time to think like a millennial and follow their ways. For sure, you can now finally achieve your financial goals.
