If you were born between 1981 and 1996, you are part of the millennial generation. This group of adults is larger than any other generation worldwide, and according to the U.S. Bureau of Labor of Statistics, millennials will outnumber all other age groups in the workforce by 2029. As a millennial, you may be well into your career and are busy balancing work life with personal and family responsibilities. If you’re at this life stage, it’s essential to regularly review your short- and long-term financial goals and ensure you’re saving enough for the future. Here are some helpful financial planning tips and ways to manage your money more successfully as a millennial.
Many millennials are in a career “sweet spot,” where they have several years of professional experience and enjoy steady income while potentially taking advantage of employee benefits like contributing to a retirement savings plan. At this age, you may be trying to manage many financial obligations, like supporting your family, maintaining a home, and building savings for the road ahead. Setting financial goals is crucial in helping you prioritize your spending and turning your aspirations into accomplishments.
You can’t celebrate the milestones until you first set the goals you wish to achieve. Taking time to explore the financial goals you picture for the next few months to 10+ years from now will allow you to map out what you want for your economic life. You can then develop the steps necessary to make these dreams come true.
Financial goals vary from person to person, but many millennials are looking to:
Now that you’ve set your financial goals, how do you reach the finish line? An essential part of getting your financial ducks in a row is adopting good money habits and using a budget to manage your income and expenses. Your budget can be your best friend when trying to keep up with bills, lower debt, and save for the future. Start by calculating your monthly income, followed by listing all your expenses. If more money is going out than coming in, look for areas where you can make adjustments. Perhaps you can cut back on non-essentials or eliminate expenses for six months to allow yourself to get back in balance. Good money management tips to follow include:
This life stage is also a great time to explore the benefits of life insurance coverage, how to grow your money with investments, or ways an annuity could bring growth potential and steady income to a retirement strategy.
While retirement may not be right around the corner, now is the time to start building your savings for the future. If you have an employer who offers a retirement savings plan, it’s an easy way to put aside money every paycheck; plus, many companies will match your contributions. You can also set up individual accounts like IRAs, 401(k)s, and SIMPLE IRAs. The sooner you prioritize saving for retirement, the more financial freedom you’ll have once you reach the next chapter. To put a financial plan in place and understand the options available, seeking professional assistance can help make the process much easier to navigate.
You likely receive financial advice from multiple sources— your family, friends, and social media. While those can be good places to inspire you to start thinking about specific topics, connecting with a trusted financial professional who is well-versed in retirement planning and money management can be beneficial. Meeting with a professional at this life stage can allow you to create a unique strategy to help you make the most of your earnings and build your savings for the future.
When you sit down together, you can ask questions, review your finances from an outside perspective, and discuss which solutions can help you achieve your goals. Every step you take to prioritize your financial health can have a lasting effect on your overall well-being and help put you on the right track toward making your dreams come true.