Finances for millennials can be much more confusing than it is for other generations. Being one of the first generations to embrace technology, gather student loan debt, and to prefer renting over buying, there are many ways millennials spend their money differently. This does not have to be a bad thing as long as you can learn the best places to spend your money and set some reasonable financial goals. Here are a few goals that you may want to consider pursuing in 2020, as a millennial.
1. Get Out of Student Loan Debt
One of the most common financial goals for millennials is to get out of student loan debt. 63%1 of millennials have over $10,000 in student loan debt, and to reach financial freedom, millennials must work hard to pay off this debt. So, consider focusing on paying off your student loan debt as your top priority. For help with this, please read our article on how to pay off your student loans quickly.
2. Build an Emergency Fund
Once you no longer have to focus on paying off your student loans, it is highly recommended that you build an emergency fund. Life happens and emergencies arise, so you want to know you will be able to take care of a “rainy day”. Having confidence that you will be able to handle a worst-case scenario will feel very freeing, as you know that you have a backup plan if all else fails. We also have an article on exactly how much money you should have in an emergency fund, so if you are interested in building an emergency fund, we recommend reading it.
3. Start Saving for Retirement
The oldest millennials are starting to enter their late 30s and are getting settled in their careers. Although it may seem unbelievable, now is the perfect time to start saving up for retirement. See if your employer offers their full-time employees 401 (k) retirement accounts. If not, consider putting money in a Roth IRA or a traditional IRA account. It is never too early to start saving for retirement, so consider making this one of your financial goals.
4. Invest in Life Insurance
Life insurance is very important if you have a spouse or any dependents you claim on your taxes. Although millennials are young, we highly recommend investing in either whole or term life insurance. One of the last things we want to think about needing is life insurance, but it is often better to be safe than sorry.
5. Make Investments
Most financial experts recommend that everyone makes at least one investment that will get them a good return. This could be stocks, purchasing real estate that you lease out, or even purchasing a house of your own. No matter where you decide to invest your money, it is a great idea to invest in something and potentially grow your wealth.
Finance for Millennials
If you are unsure about where to invest your money, which retirement plan to use, or have other similar questions, please feel free to contact one of our financial professionals and we will help you set your financial goals. Finance for millennials is a very important subject, and the sooner you get your finances under control, the better.
1 “63 Percent of Millennials Have More Than $10,000 in Student Debt. They’ll Be Paying for Decades”, Minda Zetlin, January 11th, 2017
This article is for informational purposes only. Please be advised that this article is not intended as legal or tax advice. PPG-139592 (1/20)(Exp. 9/20)