Millennials, Your Financial Struggle is Real

by | Jun 20, 2016 | Money Matters

The struggle is real… real annoying, real frustrating, and real overwhelming. (Yes grammar police I understand I should be using the word really). Read on for the top seven financial frustrations of our generation and pragmatic tips to alleviate their sting.

7. You want to be debt free

You see the financial mess our country is in. You may even see your parents financed to the max and stuck working jobs they hate to pay that debt. There’s gotta be some way some how to be debt free but it seems d*mn near impossible. You started your adult life with a sizable chunk of student loan debt and not a single piece of equity to your name.

What are you supposed to do? Eat ramen noodles and serve Natty Ice and Franzia at all your parties? That’s not gonna happen, college is over with and you’d like to live some semblance of a grown up life.

Tip: Find a way to decrease the cost of your student debt either by refinancing or through loan forgiveness such as PSLF. These two options don’t require a whole lot of sacrifice on your part but are smart financial moves that can save you thousands.

6. You want to travel and see the world

Oh the possibilities! The world is such a big beautiful place and there’s so much to see. You don’t have kids yet and now’s the time to indulge your wanderlust. There’s a huge problem though… travel isn’t exactly cheap. Experiences are the foundation of millennial life.  You’re not satisfied going to work, coming home, sitting on the couch for a Netflix binge and calling it a life. You want more and travel fits that bill.

So what’s the move here? Wait until you’re financially stable to travel? Will you ever be financially stable enough to travel? You’ll probably be content to do nothing by the time the financial winds are in your favor.

Tip: You’re going to have to get crafty and you’re going to have to save. Pick out your big trip and set a date. Next time you’re about to mindlessly online shop remind yourself of the trip and sock that money away. Get creative with cheap Aribnb’s or hostels and use cheaper alternate transportation like bus, train, or subways to slash the cost.

5. You want to buy a house someday

Renting is starting to get old. Noisy neighbors and landlord white paint have lost their charm. You’re also getting tired of throwing away your money on rent. Here’s the thing about “throwing your money away on rent”. You’re not entirely throwing it away. When you own a home you “throw away money on property tax” every year as well. Depending on the size and price of house you would buy you’re probably not “throwing away” as much as you think on rent.

Renting is a bit of a lifestyle thing. If you’re not ready to mow a yard, shovel snow, repair roofs, and keep up with maintenance then renting is still a good option. Deciding when the time is right for you is the first step.

Tip: Start pricing homes and get an estimate of what you can afford on your current income. Start looking at homes in that price range and see if there’s anything you like, are homes selling for above, at, or below their assessed value? This will give you a feel for the housing market in your area. Realtor.com lets you search on a map so you can pick your favorite neighborhood and filter by price and other criteria. See what’s out there so when the time is right you’re ready.

4. You want to work a job you love and make an impact

Purpose, autonomy, mastery; according to the book Drive these are the keys to professional fulfillment at work. Millennials especially connect to purpose and autonomy. You want to solve problems and do it your own way.

Remember that student loan debt? Well unfortunately you got a degree in X and are super passionate about Y which has nothing to do with your degree or any degree and doesn’t pay enough to repay your student loan debt. Now what?

Tip: Consider setting up an income-based repayment plan and taking the job you love. Be sure to negotiate pay as much as possible and think about adding on a side hustle. Don’t go back to school and take out more debt! Everyone will suggest “going back to school” like somehow more debt and being four years without income will make things magically better. At some point you need to draw the line and make the skills and degree you’ve got work for your career.

3. You want to change the world and give generously

Philanthropy is super important to you. You want to be a part of building a great community. Unfortunately it’s tough to come up with the extra money to donate to your favorite causes.

Tip: Donate a little bit of money and a little bit of time. One day make a conscious decision to pass on a fabulous cocktail while out with friends and donate that $5-$10 to your favorite charity. Then find somewhere to volunteer that’s pretty flexible (whenever/wherever) and donate an hour or two of your time a month.

2. You want to support companies that do the right thing

You want high quality stuff and you want to help a good cause. But buying everything from the right company can get a little overwhelming both financially and mentally as you try to find the right brands to buy from.

Tip: Find a shop that makes it easy. Stores that sell sustainably sourced, good for  you, profit donating products exist both online and in physical shops across the country. They’ll take the work out of hunting for the best products. To abate the often higher cost of these goods focus on quality over quantity and choose products that are multi-functional.

Check out this blog post for a list 150+ socially responsibly companies.

1. You want to live a life that’s not defined by your income

At the end of the day the goal of life is just to live one you enjoy. The reality is money makes the world go round and you’ve got to know how to use yours to build the life you want. It’s not about competing with others or meeting a certain standard. It’s about defining your own legendary life and coming up with the funds to live it.

You’ve got to ask yourself what makes you happy? Is it things? Is it experiences? Is it friends and family? Some combination of all the above? Figure it out and apply your money.

Tip: The best things in life are free. Write down two things your money has gotten you that you’re super grateful for and then write down two things that money can’t buy that make you ridiculously happy. Was it harder for you to come up with two things you spend money on that you’re grateful for or two things that are free?

 

The financial struggle is real my fellow millennials, but that doesn’t make you a victim of your financial circumstances. Share the two things that make you most happy that can’t be bought in the comments below or in the Millennial Maxims Facebook group.

If you love these tips you’re gonna love my upcoming book title TBD due out in October!

Take the Busywork Out of Budgeting with 5 Tips and 1 Tool

by | Jun 6, 2016 | Money Matters

This isn’t another generic budgeting article telling you to spend less by purchasing store brands or staying in instead of going out. That’s like reading another weight loss article saying it’s all about calories in vs calories out… no sh*t Sherlock. Budgeting at it’s core is about spending less money than what you bring in.

The real trick is focusing on how to get the most from your money. It’s about spending within your means by paying for the things that matter to you and skimping on the stuff that doesn’t. Successful spending is about getting behind your own plan by crafting a plan that’s realistic for your lifestyle and income.

I’m skipping over a bunch of budgeting basics with the assumption that you have some baseline knowledge. To bring yourself up to speed check out these three posts to avoid buying misery Part 1 Create a Budget, Part 2 Dealing with Debt, and Part 3 Emergency Funds.

Tally up How much Money You Bring In

This tip is about establishing a baseline of income above which you don’t spend.

How much money do you bring in from all streams of income every month after taxes? This is the amount you have to work with each month.

If you don’t bring in a steady income, underestimate. You can stay within budget if you make more money but if you set yourself up for failure by estimating too much income it will be tough to make the most of your money.

Tally up Your “Have To’s”

This tip isn’t about judging your spending it’s all about identifying it.

Start with the stuff you have to spend on, like it or not. Things like utilities, rent/mortgage, health insurance, groceries, student loan debt, etc.

Then add on your recurring subscription services that bill monthly (Netflix, Birchbox, cellphone bill, etc.) These may not be necessities but they come out of your account regularly.

Finally add up the other things you spend on like eating out, clothes, entertainment, hobbies, etc.

Identify Where you Waste Your Money

This tip is where you’ll free up your money to make the most impact.

You’ve pinpointed where all your money goes and it’s time to actually assess your spending.

Where do you spend absentmindedly without getting much return and enjoyment? If you’re spending without pleasure on something that’s not a basic need (food, shelter, clothing, safety) then it’s a waste of money.

For me this is ordering drinks when I eat out. I really don’t enjoy the booze and it dramatically increases the cost (and calories) of dinner!

Choose Something You Enjoy Spending Money On

This tip is the where you’ll make your money fun by identifying the most valuable things you buy. If you were good at the tip above you will have freed up some extra cash.

Identify one or two things you love that enrich your life in so many ways. It could be a hobby, your side hustle, travel, or gift-giving. Whatever it is allow yourself the freedom to spend here by mercilessly cutting spending on stuff you don’t need and don’t enjoy.

Make More Money

Oh really that’s all Jeni? Just make more money, phew thanks for that earth-shattering tip 😛

Seriously though, if you have expensive tastes and enjoy the finer things in life you’re just going to have to make more money. Start a side hustle. Check out any of these Google Search Results for ideas.

I’ve made a little extra money on the side with my book Millennial Maxims. It hasn’t been much, less than $100 and I’ve donated like $50 of that to 4 Paws for Humanity so have kept even less for myself. But I paid for the cover design and at some point will have earned enough to cover the editing.

I’m still exploring side hustle options myself because your personality determines what fits for you. My advice is to just try one you think you’d like and see what happens!

Use Mint to Track Your Finances

Mint is an app/website combo created by Intuit. This is the tool to take the grunt work out of budgeting.

Tracking your income and categorizing your spending can be a huge time suck. Mint knows the struggle is real and compiles your financial life in one spot. It has a simple and easy to read interface on both the app and the website. You can input all of your assets (home, car, investments, 401K) and all of your debts (student loans, home, car) and hook up all your accounts.

The key to Mint’s success is the ability to link all your accounts. Your savings, checking, debt accounts, credit cards, 401K, everything. This means  you don’t manually have to track a thing. Mint will also categorize all your spending to the best of it’s ability. If you correct a category, Mint will remember for next time and categorize the expense correctly.

It allows a super quick overview of your overall net worth and quick views of spending. You can set financial goals (like savings, debt, or retirement goals) and track your progress. Mint even sends you updates on progress and warnings when you’re approaching budgeted spending amounts.

 

With these five tips and one tool you’ll have everything you need to build your financial savvy without starving or never doing anything fun ever again.

Share where you’re going to save and where you’re going to spend in the Millennial Maxims Facebook group or the comments below!