Studying different generations gives us an opportunity to understand the unique lifestyles and influences that have shaped society over time. Each generation has overcome economic hardships and continues to make record-breaking history. Millennials, also named Generation Y, were born between the years of 1981 and 1996. This group represents the largest generation in the United States, with an estimated population of 72.7 million, according to Statista. Millennials are known as the generation that witnessed the rise of cable television, the election of America’s first black president, and the deeply tragic events of September 11.
The last four decades have introduced new global and economic tensions that continue to impact different areas of our lives, particularly our approach to finances. At Elements, we understand the pressures to adapt to an ever-changing economy. In this article, we will discuss Millennials and their relationship with money and share valuable tips to empower them to achieve financial success in the upcoming stages of their lives.
How Do Millennials Approach Money?
The 1980s and early 1990s ushered in a consumer-driven era with the rise of cable television. This form of media introduced new advertising strategies tailored to niche audiences, influencing Millennials and their spending habits. Millennials are “adulting” in an era defined by the Internet, where shopping, buying groceries, paying bills, and enjoying entertainment can all be done at their fingertips. It’s fair to say that many Millennials use their finances to simplify or enhance their lifestyles.
Millennials often inherit their knowledge of money from their Baby Boomer or older Generation X parents. While these generations may appear more financially stable, both groups have faced economic shifts impacting their finances. Despite this, Millennials grasp the basic principles of money, emphasizing saving and investing for the future. Many also prioritize obtaining a college education for higher earnings, which has left nearly half of Millennials burdened with an average student loan debt of $40,000, according to Business Insider.
Reaching financial milestones may appear daunting for Millennials juggling debt and other societal pressures. Our team of experts is here to remind you that success is still within reach! Whether you’re a Millennial yourself or know someone who is, consider the following advice to help this generation allocate funds and take control of their financial future.
- Recognize Your Goals
If you’re a Millennial, you’re most likely in your 30s or 40s with several decades of life ahead of you! It’s important to ask yourself the question: Where do you see yourself 10 to 20 years from now? Begin setting financial goals that will prepare you for the next chapter of your life. Not all your goals have to be centered around finances, either. The goals you create should be personal to you and should reflect whatever you desire most in life.
- Establish a Financial Base
As adults, we often encounter unexpected challenges such as car troubles, home repairs, or health issues. These situations can be financially stressful, especially if you are unprepared. It’s important to have a source of funds available to pay for sudden emergencies. While you can’t prevent accidents from happening, you can certainly prepare for them. It’s also a good idea to store your emergency funds in a High Yield Savings Account to earn dividends on your money over time. Knowing that you have a safety net in place can reduce anxiety and allow you to focus on investing money toward your long-term goals. Read more about the High Yield Savings Account at Elements.
- Invest in Your Future
The concept of early retirement sounds enticing to many Millennials. Instead of working through your 60s or 70s, perhaps you can retire early and pursue the dreams you have that are outside of your 9 to 5. Even if early retirement isn’t part of your plans, it’s still wise to invest in your future self. The more money you have set aside, the more prepared you’ll be when retirement comes. You can also invest your money into different assets like stocks, bonds, or even real estate to build wealth. As you invest your money, be mindful of possible risks to maximize your potential returns.
We’re always here for you! Contact Elements Financial to schedule a 1:1 appointment with one of our trusted financial experts and kickstart your journey toward financial wellness and your desired achievements.
