Good money habits from millennials
Most millennials entered the workforce during and after the global recession of the late 2000s had to navigate a tougher global economic environment than the previous generation – one of high inflation and unemployment, social and political unrest, and low economic growth.
Here is what you can learn from the generation;
Excess can wait – cut extra expenses to take care of important costs of living
Millennials understand the importance of cutting down in order to save for what they want. The 2018 Old Mutual Investment and Savings Monitor (OMSIM) found that Recently Independent Financial Strapped (RIFS), a sub-segment of millennials, see savings as a priority. Some 50% of RIFS are saving for investment, while 36% are saving to purchase a property and 35% for a rainy day. “We understand that a ‘good life’ does not have to mean lavish spending.”
More is more – get the most out of job opportunities
Millennials want a larger slice of the money pie. “We know that saving requires disposable income to be put away, and according to the Bank of America’s 2018 Better Money Habits Millennial Report, we – more than previous generations – are asking for raises and moving jobs for better-paying opportunities.”
Jobs are not the only source of income – find side-hustles to generate wealth
Unlike the linear notion of formal employment held by previous generations, millennials operate in a world that is more flexible in terms of income opportunities. “Many of my peers are selling services and products in addition to our ‘day jobs’, a phenomenon that earned them the term ‘Slashers’ in a previous OMSIM. The 2018 survey shows that one in three RIFS are Slashers. The ‘slash’ refers to the forward slashes used between job descriptors, as in, for example, programmer/yoga teacher.
“From Instagram modelling to Youtube vlogging, teaching language online or completing brand surveys for quick cash injections – millennials are creating wealth outside the formal job market,” says Joseph.
Mindfulness is the wealth-way – keep a firm eye on your money
“We have taken our money out from underneath mattresses and are keen to know where our money is going and how our savings are growing. Over 140 000 South Africans, mostly millennials, use budgeting and saving app 22seven to help. It allows us to track our spending and saving habits and stay on top of our finances.”
Debt must be addressed – fight yours sooner rather than later
According to TransUnion, American millennials are more cautious when taking on shorter-term debt than previous generations and are instead using credit facilities for longer-term goals such as student loans. South African millennials are at risk because expensive credit, particularly store credit, is easy to come by. Joseph refers to the results of the NBC News/GenForward study and says that the downside of expensive debt is that it cripples millennials’ ability to save for the things that matter like education, holidays, retirement and paying it off may delay important life milestones like purchasing a home and having children.
SOURCE: DESTINY CONNECT