Millennials are people who were born between 1981 and mid-1996’s. They make up 23% of the world population, which translates to 1.8 billion people. This is a good number since they have revolutionized the world through their creative and innovative ideas, although they are known for having poor financial decisions.
Most of them are suffering from the Peter Pan Syndrome. The syndrome explains how millennials have forgotten they are growing up and need to prepare for the future. Though, they are becoming financially literate, thanks to the internet. We still have a long way to go.
We’ll discuss in-depth some of the financial mistakes millennials make. Thus, if you fall between the ages of 23 and 38, this article is for you.
5 Common Financial Mistakes Millennials Make
1. Allowing a debt to pile up
It’s one of the big mistakes millennials make. If you have debt hanging on your head, it will haunt you for the rest of your life. The best way to deal with your loan is to repay it. Talk to your financial provider or lender to come up with a loan repayment plan. The banks will understand and offer you a repayment plan that fits your needs.
We insist on settling your debt since it affects your credit score. Take time and work extra hours, seek online gigs and ensure you settle the debt on time. You can take detailed description from Robocash to settle the debt on time. Always remember running away from your debt only increases its interest rate. It’s time to pay up!
2. Having no savings or investment
Your saving and investments go hand in hand. It’s time you stop living in the moment and start thinking about the future. You remember when COVID-19 began, no one knew how long it would take.
We are in 2021, and the effects of the pandemic are still being felt. Many have lost their jobs as businesses are struggling to get back on their feet. If you didn’t have any savings or investments, you are doomed.
You must have a bit of cash saved up and the rest invested in a business. Your saving acts as a backup in case things fall apart. This is cash you shall use to get back on your feet if you lost your job or get fired. Hence, open a savings account and begin channeling a percentage of your income.
On the other hand, having multiple streams of income is a wise investment approach. You can channel your cash; it could be on government bonds, stocks, bitcoin, real estate. Don’t let your cash lie around in the bank, and it can generate revenue for you.
Find something to invest in, but, before investing research about the portfolio. Having all your facts right minimizes losses and increases your profits. Yes, “You Only Live Once,” but the future isn’t guaranteed to be wise.
3. Social media lifestyle
Social media has a huge impact on millennial’s life today. You always want to know who is doing what, where they are, and the life they are living. The sad truth is many have been driven to their graves because of the social media lifestyle.
We agree everyone wants a lavish lifestyle where you can buy want you want and when you want. But it takes time to achieve this; nothing comes handed on a silver platter. You have to work hard and smart.
Therefore, if your friend has bought a condo unit or the latest car, DON’T be eager to do the same. Live within your means and appreciate where you are in life. Remember, the likes and comments on your social media accounts don’t translate into cash. Be wise and spend your cash wisely.
4. Impulsive buying
We have all bought something impulsively; it could be a notification on your phone of a 90% discount on a product and you bought the item. Alternatively, you could be walking into a supermarket and see an item being offered at a resistible discount. But the big question is, do you need the item?
Before purchasing an item, identify the need. Don’t purchase the product because of the discount it’s coming with. Learn to control your desires and prioritize the needs instead of wants. Therefore, turn off the notifications on your smartphone from the online shopping store. Also, when heading to a store, ensure you have a list and stick to it.
5. Having no regards for the future
YOLO, that’s a mantra most millennials live by. They are only focused on today and not what tomorrow holds. Though we agree you need to enjoy your life, and it should be done in moderation. You don’t need to delete your account in the name of enjoying your life.
You are supposed to think about your future and plan accordingly. The moment you are employed, begin to think about your retirement. The earlier you do so, the better since it ensures you have a comfortable life ahead. Therefore, focus on your savings and investment while enjoying yourself.
For this reason, we recommend using the 50/30/rule. The rule allocates 50% of your income to monthly expenses, 30% to savings and retirement, and lastly, 20% goes to your personal spending. It could be to purchase the latest sneakers, slim suit; you name it.
In case you are a victim of such mistakes, there is no need to worry. It’s normal to error is to man, though you need to learn from your mistakes. Take time to put your finances in order and always think about savings and investments. And if you don’t have any savings at a critical time, know that you can turn to RoboCash for an emergency loan. You don’t have to do it often, but every Filipino from 18 to 75 years old has the option. Be smart about your finances to secure your future.