There’s an abundance of financial advice out there but for many Millenials, thoughts of saving or investing seem out of reach.
In 2019, Statistics Canada reported people born between the years 1982 and 1991 were better off financially than Gen Xers but had the highest debt to after-tax income ratio of any generation.
What does this mean? Simply put, for most Millenials, building wealth is and will continue to be a challenge.
The reality is, carrying a heavy debt-load often means delaying asset-building activities such as purchasing a home or making other long-term investments. And while it may feel like there’s no point in even trying to save for the future, there’s still value in practicing wise money management and trusting the Lord to guide and protect our financial futures.
The most important thing you can do for your finances is practice budgeting. Stay with me. People tend to look at budgets as restrictive, but when done right it’s completely liberating.
A budget doesn’t judge you, it helps you reach your goals. You get to decide what you want to accomplish and your budget is the practical framework of how you’ll get there. It brings your ideas and aspirations into reality. It makes things possible.
See? Not so bad.
But in order to budget properly, you do need to face your finances—actually open your statements and look at your credit card bill. It means adulting in the most adult way and taking responsibility for your actions.
While you can’t control the economic realities of when you were born and the world you’re forced to reckon with, you can decide how to behave within it. Managing your money means taking an active role in your financial situation. Start by paying attention to where your money is going and build your financial foundation from there.
Here is what creating and maintaining a budget can do for you:
Allows you to pay off debt in a strategic way
Helps you put aside money for emergencies
Makes it possible to build up savings for future priorities
In the New Testament, Jesus tells a story called The Parable of the Three Servants. In it, three workers were entrusted with their boss’ money while they were away. The responsibility was divided according to their abilities and each worker approached their task in different ways. The first invested the funds and doubled his boss’ money. The second worker used the funds in their work and doubled the money as well. However, the third worker took the money and buried it, keeping it safe until their boss returned.
It’s such an interesting story because the third worker thought they were doing a good thing by protecting the money. They didn’t want to spend or invest any because they were afraid of losing it. And yet, their boss was furious because they did nothing with the funds. The other two workers were praised for being faithful in handling a small amount and were given more responsibilities as a reward. And the third worker? Let’s just say they were fired (Matthew 25:14-30).
While this parable is talking about literal money, its meaning extends to much more. Think about the resources God has entrusted you with. Are you hesitant to invest in case you fail? Do you wonder if it will be more effort than it’s worth so why make any at all? Or perhaps you prefer focusing on living your life rather than thinking about what God wants from you. Ponder this story and allow Jesus’ words to challenge you to make the most of your time and finances.
Your time, abilities and money have been entrusted to you by God. As Anita Wing Lee said in Why Millenials Are Stressed About Money and What To Do About It, “God owns the money and we are just God’s money managers.” When we ignore, squander, or abuse what we are given then we are not following God’s call for our lives.
So what can we do to change our financial futures? It begins with taking a hard, realistic look at your personal situation and making a plan to use what you’ve been entrusted with to the best of your ability.
Millennials are paying off the past and saving for the future simultaneously. Sixty-four percent of millennials are invested, with the most favorable form being crypto, according to a 2022 Investopedia study. In 2022, one in three millennials were invested in crypto, with the next most popular being stocks.
Millennials are paying off the past and saving for the future simultaneously. Sixty-four percent of millennials are invested, with the most favorable form being crypto, according to a 2022 Investopedia study. In 2022, one in three millennials were invested in crypto, with the next most popular being stocks.
The most popular source for millennials to get financial advice is social media. 11 Many advisors today exist in the social media space and practice radical generosity with their knowledge and expertise.
The most popular financial goal for millennials and Gen Zers in 2024 is to grow their savings, with nearly 60% of respondents placing this at the top of their resolutions list.
Worrying about saving has always been hard for 20-somethings who begin their careers at the bottom of their earning potential. But saving is especially difficult right now because on top of student debt, housing and food costs remain high even as inflation has started to cool.
They are more likely to make a budget than either of the other age groups and are saving to buy a house more than others. They are also saving for vacations, and half have a savings goal. More than half who went to college are paying for their own student loans. Some have delayed starting a family due to these loans.
“As a millennial, if you are investing in your accounts — 401(k), Roth IRA, HSA, investment account — setting up automatic contributions on a monthly or per-paycheck basis, and over time if you are increasing the amount you are adding to those accounts, this allows your wealth to grow for you,” said Darren L.
Aligning on money is all the more pressing for younger generations, who are earlier on in their relationships and careers—nearly half (49%) of Gen Zers view financial compatibility as more important than physical compatibility. That's compared to 40% of millennials, 35% of Gen Xers, and 30% of baby boomers.
Generation Z adults—individuals who are between 18 and 25 years old—prove to be more financially sophisticated than any previous generation was at their age, according to The 2022 Investopedia Financial Literacy Survey.
Millennials embody a set of evolving values and aspirations that greatly influence their choices and behaviors. This generation highly values authority, achievement, and influence, demonstrating a strong desire for control, success, and recognition.
According to PYMNTS Intelligence research done in collaboration with LendingClub, 62% of U.S. millennials live paycheck to paycheck as of September 2023, and nearly 25% struggle to pay bills regularly, a share that has remained unchanged in the last year, despite the slowdown of inflation in this period.
The average net worth of millennials has surged from $62,758 to $127,793 since the start of the pandemic. Much of this growth is from real estate; as of 2022, more than half of millennials had become homeowners. The average millennial makes between $52,156 and $62,244 per year.
The No. 1 rule of the Ramsey investing philosophy is not to invest a dime — at least not until you eliminate all of your toxic debt, which he considers to be pretty much everything but your mortgage.
Researchers claim the distribution of wealth among millennials is so uneven because the economic rewards for middle and upper-class lifestyles have increased, while those for the working class have either remained the same or declined.
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