“Want to save more? Just forget about your daily coffee routine.
It’s well-meaning advice that typically permeates the personal finance space, but for millennials – who face high student debt payments, declining homeownership, and stagnant wages – skip this latte alone just isn’t going to cut it.
This generation – born between 1980 and 1996 – experienced some of the biggest economic booms in history, but also the Great Recession. And while older millennials entered the workforce shortly before or during the 2008-09 recession, the younger cohort – those in their 20s – are starting their careers in similarly dark economic times.
For millennials, the financial fallout from the COVID-19 pandemic comes during their years of accumulating key assets. A 2019 PwC report found that 76% of people say their financial situation is stressful; add the recent global pandemic, and stressors can easily multiply.
While the path to financial well-being is difficult for any generation, it’s easy to overlook the unique challenges that millennials face. For those in this demographic, here are five ways to reduce stress on your journey to financial wellness and establish financial stability while enjoying life now.
Millennials who struggle to keep or find a job need to be flexible and creative in their job search. For example, consider a short-term job or a job outside of your area of expertise. It might not be what you planned to do, but the income is helpful and gives you valuable work experience. Preparing for remote interviews and virtual networking by practicing video and phone interview simulations can prepare you for remote hiring. Creating a professional social media presence on remote networking groups can also help. And depending on your financial situation, consider going back to school and learning new skills and training. Just beware of school debt.
For those who are employed, benefits play a greater role in supporting overall financial well-being than before. For many employees, the main financial products you need are already in your workplace, such as a pension plan, insurance protection, and a health savings account.
Whether you’ve just started a new job or just started your career, make sure you take the time to understand all of the financial benefits offered by your employer, including health, dental and vision coverage, job matching. pension plan and financial advice provided by professionals – either from your company or contracted out. HR or a pension plan service provider. Matching to the pension plan, in particular, is essentially “free money,” so take advantage of it, even if your first contributions are relatively low. The sooner you start getting free money, the longer it should grow, and thanks to interest and compound returns, the better prepared you’ll be when you retire.
While many millennials can access life insurance through an employer, don’t overlook the importance of an individual policy, either. Whether it’s to cover student debt payments, a mortgage or rent, or to insure an entrepreneurial business, there are many reasons why millennials should consider extended life insurance coverage to provide a safety net. financial support to their loved ones. Life changes, such as buying a home, getting married, or having children – common milestones for this demographic – require more protection, including that provided by life insurance, especially to a time when insurance remains very affordable.
Advances in technology have given way to resources never available to previous generations. Tools like banking and savings apps, automatic deposits and transfers, digital payments, and self-service brokerage options make it much easier to track income and ensure you spend, save, and invest wisely. In fact, when it comes to managing a budget, 34% of people between the ages of 18 and 34 say they already have at least one budgeting app on their phone, according to Bankrate. Put these apps to work! While many people find that nothing completely replaces the value of advice from a financial professional, technology is part of a holistic financial strategy.
Financial well-being is not just about amassing valuable assets; rather, it’s about using your finances in a way that helps you live a life of value. More and more, we find that millennials value experiences rather than ‘things’. And a growing body of literature suggests that financial and physical health are often closely related, making financial well-being an essential part of your overall well-being. Take stock not only on goal financial health – what you own, what you owe, how much you earn – but also your subjective Financial health – how well you see yourself managing your finances, and how optimistic or pessimistic you are about achieving the financial goals most important to you – creates the building blocks of financial well-being. Use a financial self-analysis as an opportunity to make sure you find meaning and value in your life as a whole, and assess how your finances can help play a role in promoting the activities and times you enjoy. more.
While the journey to financial wellness is not without obstacles, Millennials have the tools and mindset to adapt financial wellness strategies to meet today’s realities and future demands. Adopting these strategies can help reduce stress about what might happen and better prepare for the future.