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It’s no secret that millennials are far from perfect when it comes to money management. If that sounds like you, keep reading. This blog lists 5 things you should be wary of as a millennial. The blog also contains a few little tips to get you moving in the right direction.
Using your credit card in a responsible way, can be a great way to build – or rebuild – your credit score. Having a good credit score is important for many things in life, like getting approved on a mortgage.
The friendly salesman’s at the bank will – if you already have a credit card – have more than likely told you about these benefits, along with others, like your swanky airport lounge passes and cashback perks.
Unfortunately, when credit cards are used irresponsibly, the cons vastly outweigh the pros. Increasingly, this is becoming the case for millennials who are becoming burdened with increasing levels of debt.
When it comes to using credit cards remember two main rules of thumb
Credit cards do have advantages! When you’re buying expensive things online some credit cards give you payment protection. Be sure to also use your credit card when buying flight tickets and hotels etc as your card may include travel insurance.
‘I’ll start next month’ or ‘it’s not the right time’ are common excuses from millennials when quizzed about why they haven’t started investing any money. If you’re waiting for the right time, it won’t come. You have to create it by visualising goals. Only when you have mapped out a purpose as to why your investing, will you actually want to start.
Remember: The earlier you start investing money, the better your chances of achieving your personal goals.
Balancing the books is normally a positive phrase. However, the balance millennials often achieve, is balancing their incomings and outgoings, by spending everything they earn. And it’s no wonder. When you’re young, living in the moment seems a lot more appealing than planning for your future. Unfortunately, if like most people, you have the desire to one day reach financial freedom and live off your wealth, you need to start accumulating some of it.
Society often pressures us to spend at every opportunity. When you get a raise or a bonus at work, people often ask ‘what’re you going to spend it on?’. Remember, you don’t have to upgrade your lifestyle every time your financial situation improves.
The amount of money we spend online as a percentage of our total expenditure is growing all the time. Online grocery shopping, takeaway deliveries, clothing, flights, insurance. You can buy pretty much anything online, which is both good and bad news.
Bad: Because marketeers are smart. Very smart. Billions of dollars are spent every year trying to prize your hard-earned money away from you online, in exchange for goods and services. This is done through targeted marketing. They know what you like, when you like it and why you like it. So when you’re online, you need to have your guard up.
Good: Years back, your choices as a consumer were far smaller than today, as people did the majority of their shopping on the high street. Businesses could often charge a premium in the absence of a competitor. The internet has changed that, and now, you can compare everything. So take advantage of it! So when you’re booking a flight, use Skyscanner. When you’re buying insurance, use Compare the Markat. When you’re buying anything, research, research, research!
Whether you realise it or not, our generation is making more and more decisions based on how they believe it will be viewed by others on social media.
‘Our behaviour online all goes back to our sense of worth offline. It also relates to our psychological state, most namely whether we have low self-esteem and other certain tendencies such as narcissism, anxiety and depression, which therefore translates into a need for admiration.’ Victoria Halina
More and more we are seeing millennials broadcasting everything we do on social media in the hope of getting admiration and social approval in the forms of likes and shares etc. Why? Because ‘likes’, for most people, releases dopamine. Dopamine is the chemical in your brain which gives you pleasure. Therefore, posting is similar to any other addictive activity like smoking or drug-taking.
Be smart with your money. Every time you get the urge to spend it, just remember how hard you worked to earn it.
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