Our series about money mistakes continues! We’ve taken a look at the Baby Boomers and Gen X, so now it’s time to see what the Millennials do with their money…but maybe shouldn’t.
Here are Five Fast Facts on money mistakes by Millennials:
- ❓ Who Is This? The Millennial generation was born from 1981-1996. Now well into adulthood and moving toward their prime earning years, these folks still have most of their lives – and Paychecks – ahead of them. Now if they would just avoid the mistakes of their parents at that age!
- 👪 Where In The Journey? This is the first generation to experience both pre-Internet and our current day tech. They are now getting married, buying homes, and having kids. High costs of everything from education to groceries is making it tough to save up for the future.
- ⚖️ Assumption #1: Stay Safe! Millennials are notoriously risk averse with their finances, probably because they were young and impressionable (though old enough to understand) the Great Recession in 2008. Because of this tendency to play it safe, they also tend to miss out on rewards like catching the market rebound after 2008. The best course here is to work with a financial advisor and land on a reasonable balance between risk and reward that adjusts as they grow older. It does require actually DOING what they tell you, though. 😉
- 💵 Assumption #2: It’s All Mine! A lot of married Millennials keep their money separate, not only day-to-day but also their long term investments. The problem here is that they miss out on opportunities to balance each other out and shore up gaps in their financial plans. Even if you don’t put it all into a combined bucket, it’s best to stay in close coordination to make sure everyone is rowing the boat in the same direction. You know what they say: sharing is caring!
- 😲 Assumption #3: My Turn Now - Millennials generally think they should be living their “best life” by their 30s and 40s, just like their parents. Problem is, they’re comparing to their parents in their 50s and 60s, after a couple more decades of income. Also, it was a very different economic time for the older generation! For example, Boomers paid a median of $216k for a house but Millennials have to shell out $328k! The key is to make sure you manage your lifestyle based on what you actually make, not what you see others – your parents included – appear to have. #funsponge
🔥Bottom line: The good news for this generation is that they’ve got lots of time and plenty of opportunity to fix whatever they need to in their financial situation. With decades of earning ahead of them, they can start making better choices and plans now, and really reap the rewards in the future. If they’re willing, that is.
How do the Millennials in your life do with their finances?
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