It’s time we finally put some of these millennial cliches to rest. Yes, millennials like video games, but they don’t play in their parents’ basements for 24-hours a day (the average gamer spends 6.5 hours each week playing games); yes, millennials are different than other generations, but that doesn’t make them “lazy;” and yes, millennials spend quite a lot of time on their phones, but they still work hard.
Despite all these rumored stereotypes (plus a few more), millennials are talented, hardworking, and more comfortable with technology than any other group of people. Though young Americans have plenty of opportunities available to them, perhaps more than ever before, they still face some serious challenges.
High student loans, stagnant housing markets, and a dearth of high-paying jobs have caused all sorts of difficult issues for millennial Americans. In addition to these major problems, the fact that average millennials aren’t as financially literate as some of their generational counterparts is even more concerning.
According to Forbes, approximately 34% of millennials are unsatisfied with their current financial standing and 18% are “not at all” satisfied. Over 50% of millennials are worried that they won’t be able to pay back their students loans, including 34% who earn a household income of more than $75,000 per year.
NBC News reports that as millennials — especially Latinos and African Americans — continue to struggle within the housing market and own fewer homes, the already substantial wealth gap will continue to grow. A recent survey found that nearly 66% of consumers are planning on renovating their homes. Even if a millennial couple can come up with enough capital to actually purchase a home, it’s going to be difficult for them to keep up with all the home’s necessary maintenance needs, let alone perform expensive remodeling projects.
“Most millennials have those burdening student loans that make it impossible to make other investments because it’s like they have this dark cloud over their heads,” said William Neal, a 24-year-old freelancer in the TV industry. “In urban areas, it’s not realistic for a young person to buy a home. It’s way too expensive. For a middle-class person, it’s impossible, especially if you have student loans.”
Additionally, according to a George Washington University survey, only about 8% of the millennials polled had what the researchers were calling a high level of knowledge about personal finance. And roughly 25% of the respondents were able to demonstrate a basic understanding of personal finance. It is even more concerning that 70% of the individuals who took part in this study believed their financial literacy and money savviness was “high-level.”
By simply being aware of financial shortcomings, millennials will hopefully start to better handle every aspect of their financial life. If you’re a struggling millennial, hopefully, these practical suggestions will help you get back on the right track to financial success:
- Track every dollar that’s coming in and going out — The easiest way to improve your money management is to actually start tracking all your money. Once you see how much money you’re spending weekly, monthly, and annually on certain expenses, it’ll help put your finances into perspective.
- Consult with an experienced probate attorney — Approximately 78% of millennials do not have a will. If you are one of the rare millennials with assets in the six figure or higher mark, you should already have a will and trust set up to help minimize your estate taxes. But you don’t need to have a $100,000 salary to start worrying about yours and your family’s financial future. Talk to a professional who can help you set up a detailed will and trust.
- Utilize quality finance apps — Although many consumers still prefer to buy furniture in a store, furniture and home furnishings represent 12.9% of all retail e-commerce sales in the United States. If you continually find yourself struggling with saving money or tracking your purchases, consider downloading some quality savings apps. Apps like Qapital and Digit can help automate your savings. Additionally, there are plenty of apps out there that can help you keep track of everything from your individual paycheck to your long-term savings accounts.
“I remember that we made it into like a challenge. Who could save up more,” said Christian Portilla, 28, who, alongside her wife, Melani Liriano, stayed under a strict budget for one year in order to save up enough money to put a down payment down on a house. “We wouldn’t eat out. We would literally save every penny. It started getting easier when we saw the savings account going up.”
Though being diligent about not spending too much, handling loans, tracking all your expenses, and using some innovative apps can certainly help your financial standing, working with a money management advisor is perhaps the most successful way of both improving financial literacy and growing your bank account.
According to Mic, financial advisors aren’t just for individuals with a lot of money — they are great for underpaid, overworked, and debt-burdened millennials.
A Levo League and SoFi survey discovered that more than half of millennial women actually have enough money that could be invested, but 56% said they aren’t ready to do so because they are “scared.”
“[Millennials] often have the resources to invest due to diligent savings, but can be held back by fear,” said Alison Norris, a certified financial planner at SoFi. “[A finical advisor] might empower them to gain the confidence that they can (and will) be successful.”
If you’re just out of college and are still searching for a job, you might want to hold off on hiring a professional financial advisor. But once you start earning some real money, even if you have expensive loans, debts, and bills to pay back, working with an experienced money manager and being as responsible as possible with your spending — you should be on the right track to a finically secure future. Good luck and never stop the hustle!