5 Smart Money Moves for Millennials

Smart money moves for millennials? That’s right! It’s hard out here for millennials, we have a different financial landscape than our parents and grandparents did.  We are switching careers more often, having families and purchasing homes later in life, or sometimes not at all … and it’s not always by choice.

Smart Money Moves … not usually a phrase associated with Millennials. More like lazy, entitled, un-motivated, instant gratification, un-loyal, grudge-holding, spenders.

Are we just a product of our environment? We have all been raised in an era that had a major influence on our behavioral patterns and thought processes. Some in ways we may never understand.

STOP falling into the mindset of believing there is only one way to accomplish your financial goals. Just because it worked for your neighbor or your parents or your co-worker doesn’t mean it will work or be RIGHT for you. THIS IS NOT A ONE SIZE FITS ALL T-SHIRT PEOPLE! If I hear someone parrot “buy term and invest the rest” or “purchasing properties is the only way” ONE MORE TIME!

I digress ….

Here are 5 smart money moves we millennials can make now that will benefit us later in life. They are simple to implement and overtime will help your money grow. Remember that a small change in your trajectory now, can make big changes in the future.

1. Leverage your greatest advantage: TIME

Millennials are between the ages of 22 and 35, which means we have decades to go before retirement, and compound interest is on our side!  Saving as much as possible early on, has a HUGE effect on finances later.

Tip: Don’t get yourself down if you haven’t started, or don’t have a huge amount to send over to retirement.  Start now, with what you can, and learn to include this more and more in your budget. 

2. Claim the “free” money

Many employers will offer a 401k match percentage, anywhere from 3% to sometimes even 10%.  Taking full advantage of that match amounts to free money for millennials, well actually everyone! If you are having a hard time fitting this into your budget, check out my steps to creating a budget here.

Tip: If your employer will match up to 5% of your paycheck, invest AT THE VERY LEAST that much to your 401k monthly.

3. Don’t be afraid of investing

Investing can sound scary, and there are risks involved, however it’s likely to grow more overtime than your savings account.  Saving money is very important, but it’s not the only way.  As Joanna Pratt, an investing expert at NerdWallet puts it, “a well-diversified portfolio has historically beaten inflation by a meaningful amount.” Begin learning about investing, start small, and overtime you will see your investments grow.

Tip:  Invest in companies you like, who’s products or services you use. For me, its Apple and Amazon!

4. The Side Hustle

Millennials may not have invented the side hustle, but we have perfected it!  Whether you’re driving for a ride sharing service, selling your used items online, or creating a blog to earn extra income, there is a side hustle for everyone.  This is a great way for our generation to earn some extra cash doing things we love.  The side hustle helps millennials earn financial freedom right now and allows us to save more for our future!

Tip: Find 3 hobbies, one to make you money, one to make you happy and healthy, and one to keep you creative. Sometimes these hobbies might overlap and that’s OK, actually it’s great!

5. Use apps to help you manage your money and save better

We love our phones, and it’s always fun to download a new app!  There are tons of apps out there to help you keep track of where your money is going, help you invest simply, and even coupon codes or rewards programs to help you save where you shop.  Here are some of my favorites:

Mint: tracks where your money is going, helps you see where you can cut back, and even include some savings.

Honey: it’s not an app, but you can download it to your computer.  Honey will automatically search for savings and coupon codes when you are shopping online.  Who doesn’t love an unexpected 10% off discount?

Acorns: connects to your debit or credit cards. This app will round up to the next dollar on all your purchases, giving you a small chunk of change to save or invest.  These small investments are often unnoticeable but can grow into large amounts over time. “Mighty oaks from little acorns grow.”

Local Grocery Store Rewards: Get off your parents’ rewards card, join the program yourself, and find new ways to save.  Many of these programs will allow you to save up points for free items, gas rewards, or grocery gift cards.  I recently earned a $25 grocery gift card from my rewards, and almost always save on gas.  You’re buying groceries anyways; you might as well get rewarded for it!