The term “millennial” is a very broad description. It can be used to describe anyone born between 1981 and 1996, according to Pew Research.
It can be difficult to describe millennials with a broad description because millennials can be in their early 20’s or their mid to late 30’s. Although two different people may be millennials, they could very likely be in different life stages.
However, building a strong financial foundation is something all millennials should be striving for. After all, even the oldest millennials have a lot of life left to live. Here are some things you can do now to build a solid financial foundation for the future.
Start Saving for the Future
A little bit of money saved today can turn into a lot of money when it comes time to retire. It may seem crazy to already be planning for retirement but starting that planning now can save you a lot of stress down the road.
There are a number of great calculators online that let you see how much you could save by time retirement rolls around. Play with the numbers and you will quickly see that saving a little money now will yield much better results than saving a lot of money when you’re older.
Be Smart About Debt
Some people think debt is bad and that’s simply not true. There is good debt and bad debt that you can take on.
Good debt is low interest debt that allows you to invest in your future. A student loan to help you build a rewarding career can be considered good debt. A low interest car loan or home loan to build assets that help you in your day to day life could also be considered good debt.
Bad debt is high interest debt that sucks you into a revolving lifestyle of high payments with little results. Payday loans are a good example of bad debt.
Part of being smart about debt is doing your research. There are some valuable online tools that allow you to compare rates from a number of lenders all in one place. With this information, you can make the best decision before taking on debt.
Spend Your Money Wisely
This almost seems like it should go without saying, right? Most people know they should spend their money wisely but, in practice, they don’t know how to do that.
The secret to being careful with how you spend money is to learn how to budget. Use a pen and paper or go the modern route and try a smartphone app. Simply doing a budget will give you better control over your finances.
Once you have control over your spending then you can dedicate money to paying down debt, growing savings, or setting aside money for a purchase instead of putting it on credit.
Life is a Journey
Just like life, building a solid financial foundation is a journey. You cannot change your situation overnight.
Commit yourself to developing good habits and making the right financial decisions. Over time, those good decisions will add up and put you in a great position for the future.