Millennials don’t always have the best reputation for how and what they choose to spend their money on, but that doesn’t mean they are incapable of saving money for their futures. As with different stages of life, there are different stages of millennials, and we’re here to help get you on the right track no matter where you fall on the millennial scale. Whether you’re fresh out of high school or figuring out adulthood, one of the best tips we can share is set up a saving account. Then, once you understand your savings plan and feel comfortable with what you’re putting away, Ally Invest can help you strategize on the right investment plan for your life.
If you need a little help saving money to put away and invest, here is our millennials’ guide to saving money:
Young Millennials (High School Seniors and College Students)
Just finishing up high school and starting college or moving into your first real job is a great time to start honing your savvy savings skills. Pick a few that work for you and build from there. Here are a few areas to start saving at the end of high school and in college:
- Start Searching for a Scholarship Early
- School is expensive, so finding sports, honor, or other types of scholarship can get you an amazing education and allow you to leave college with little to no debt. Talk to advisors, do your research, and take the necessary steps. Even if you don’t have to pay for your own school, it’s good to see what you qualify for.
- Get a Loan for Just What You Need to Spend
- When you are requesting your loan amount, don’t go overboard. From meal plans to costs of books, there are areas where you can cut back so that you are drowning in payments when you graduate and are trying to survive on an entry-level salary.
- Become a Resident Advisor
- Many times, RAs get free room and board, which drastically reduces what is due every year to the university. Explore what your school has to offer.
- Rent Your Textbooks
- Textbooks are extremely expensive. Rent your books, shop online, borrow from other students or check them out from the library. Don’t just accept the price the bookstore is selling them for without price checking elsewhere.
- Start Making Meals at Home
- If you’re lucky to have a kitchen in your college apartment, start making meals at home. Meals plans are expensive and eating out, even in a college town, quickly adds up. Cooking simple meals at home leaves you more money to save or use for fun activities.
- Take Advantage of Student Discounts
- While you have your student discount, ALWAYS ask for a student discount. Museums, clothing stores, movie theaters, and so much more have discount prices available.
- Get a Part-Time Job and Put That Money Away
- If you can work while you’re in school, do it. This is a fun way to meet people and start putting money into a savings account. If you need spending money, take half of your paycheck to use and half to save.
Mid-Millennials (Post College-Late 20s)
Getting your first big kid job is an exciting and scary time of life. It’s especially important to set a solid budget and live within your means during this time of life. It’s extremely tempting to blow your first adult paycheck but resist! Here are a few other great savings tips for your 20s:
- Negotiate Your Salary
- While you won’t have a ton of room without any experience, always try and negotiate your salary. Of course, make sure you have reasons as to why you’re asking for more. Don’t be afraid to do this as your move through jobs and companies.
- Live with Roommates or Move in Back Home Temporarily
- Living with other people is a great way to stay within your means and share expenses. If you’re close to home and your parents allow for it, move back in with them for a bit. Get settled after college and take time to set a budget and start saving.
- Track Your Spending
- The first step to setting a budget is knowing how you spend your money. Take a month and audit your expenses. This will give you a good idea of what spending can stay and what spending needs to be refined.
- Set a Budget and Follow It
- Set exactly how much you want to spend on rent, utilities, fun time, and whatever other monthly expenses you have. Compare that to what you make and build out a reasonable amount you can spend each month to ALSO have money left over for your savings. You might not be able to save hundreds every month when you first start out, but even putting away $5 a week and not touching it will help you.
- Set Up a 401K
- Especially as you get into your mid to late 20s, get set up with a 401K and allot money from every paycheck. If you’re company matches, max out what they allow so you’re saving as much as you can for your retirement.
- Gain Credit
- Open a credit and make sure to pay off the bill every month. A great starting tip great is only charging $20 dollars on it every month and paying it off. It’s just a means of building credit, rather than relying on the card as a sustainable use of money. The more credit you gain, the easier it will be to rent an apartment, buy a car, etc as you get older.
Adult Millennials (Early Thirties)
By your early 30s, you’ve already had a job (or a few), are probably looking to buy a house, and may even have started a family. This is when life gets real, so it’s even more important to stick to your budget and try saving even more money than previously. Here are a few other savings tips for the adult millennials in their early 30s:
- Set a New Budget and Check Back Frequently
- If you haven’t looked at your budget recently, update it now. Add in your new expenses, responsibilities, and goals. Understanding where your money is going and where you want it to go will ensure you can afford what you need and want. It’s especially important to continue living within your means at this time of life. There are so many surprises that can come up, so don’t overextend yourself
- Make Sure You’re Setting Aside 15% of Your Income to Retirement
- Retirement might have seemed irrelevant when you first graduated, but now it can’t be avoided. If you aren’t already, make sure you’re setting aside 15% of your income to a 401K or Roth account.
- Bump Up Your Health Insurance and Use Your Benefits
- You’re older now and may even have kids, so make sure you have health insurance that covers any illnesses, tests, or concerns that may come up with your age. Also, take advantage of your health benefits: go to the doctor, dentist, eye doctor etc. You’re paying for them, so you might as well go for your checkups.
- Advance Your Career
- Keep pushing for new positions, salaries, or opportunities and make that a priority. Have a goal of salary and growth that you want to accomplish so that you don’t lose your chance to advance in your career. Especially if you haven’t settled down yet because you can move where the opportunities take you.
- Pay Off Your Debt
- Make sure you have your debt paid off from earlier in your life. This way you won’t be adding to it when you need a loan for a house or other big life expense.
Saving money isn’t always fun, but if you set up yearly goals for yourself on how much you want to be saved, it can be a great challenge to beat the goal. Ally makes it easy to not only save money but also invest your money. A little work will pay off in the end. Good luck with your savings millennials!