Are millennials saving money? How to grow wealth efficiently

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Are millennials saving money?

Why Millennials are not Saving Sufficiently

This is not probably the first time you are reading or have heard about it; that millennials are not saving sufficient for retirement period. In reality, at the degree millennials are presently saving, some might not have the capacity to retire until they are well into their 70s or 80s. This is generally credited to the reality that millennials were purportedly raised in a different way, or are maybe less inspired and wired to save. There are specialists who would approve, & who would as well advice that there are several other ‘ins and outs’ that stands as pointers for which millennials aren’t saving for retirement.

An expert mentioned that millennials are weighed down with too many monthly expenditures thus are unable to save aside some money for retirement. In the picture, majority of millennials are short with debt, right from student loans to credit cards & they are having difficult time covering their month to month repayment obligations & living overheads. Another reason as stated by the expert – is that millennials aren’t receiving the financial education they require, such that when they are confronted with debt settlement & administering bills and credit cards, they are not certain what to do. In matter of fact, the society at large globally – has done a poor job at educating individuals on how to save. It isn’t even part of school curriculum and it isn’t taught in high school. Interestingly, the subject of ‘saving’ can be one that people feel uncomfortable or shy to discuss about to each other.

Substantially, if as a student – you are hardly making sufficient to offset loan payments monthly, it would be difficult to consider issues such as related to retirement savings. There are millennials that have been working in firms that provide 401(k) plans & yet have never opened a retirement account. In their organization’s justification, though, the responsibility isn’t on your company to get you to sign-up for a retirement plan. Firms should not be the ones to clarify matters of money management to their staffs, as such can be seen as unprofessional. Such educations have to come much earlier, & if not from parents or specialists, should come from a teacher or professor. What an irony?

Another financial expert mentions that folks in their 20s are actually missing out on substantial growth with regards to their retirement account. Practically, a 25-year-old youngster that saves $100 every month & invests in the stock market, netting a 7 percent yearly return, would acquire about $248,551 in savings by the time they clock 65. So imagine if the student could save $200, $300 … monthly?

For millenials that are seeking for ways to get themselves on the right track with retirement savings, they can look toward:

Opening a 401(k)

Typically, this looks more as a clear first step to take, however millennials are somewhat less alike their older professional counterparts when it comes to opening a 401(k) plan. Not just this, but several in the 20 & 30 plus age group – end up with no 401(k) plan – because more individuals in this era choose jobs that would not provide one to even start with.

 

Why saving money is hard and what does it teach about you?

Saving money can be easy to practice but in reality is hard for the majority. That is because a lot of people are willing to sacrifice wrongly. They would prefer to enjoy life today and live a very expensive lifestyle.

 

Recommended: Read The Millionaire Next Door: The Surprising Secrets of America’s Wealthy by Thomas J. Stanley Ph.D. and William D. Danko Ph.D. This powerful book teaches on how to live correctly, cutting your coat as appropriate so that you can save and accumulate wealth!

 

For people who learn how to save early, and who keep up with it; they are sure to be several more times financially independent than others who don’t. An employee who earns $70,000 annually is more in the making to be financially secure in few years away – than his counterpart who earns $100,000 annually but lacks the discipline to save, simply because the latter chooses to drive expensive cars, living the big lifestyle at the moment.

So in essence, folks who are able to thoroughly save for tomorrow can be said to have learned the art of discipline. They know that it’s wiser to put the horse before the cart, correctly!

 

How to save money without a savings account?

 

There are ways to save money without actually going to the banks, as savings doesn’t necessarily mean always transacting with a bank. In general, when a person needs to save money, his or her thought would be to open a savings account in any local commercial bank. What is seen to be savings account in most local commercial banks – is actually not, as the saver is free to withdraw all the money from the account. Such “savings” are reflected as short term & commercial banks hardly depend on such funds to extend long-term credit.

Bank Alternatives for Saving

Life insurance: A life insurance policy can be initiated for an individual from monthly deductions for a period of years, retirement or until death based on the preference of the policy owner. Life insurance is clearly a savings product that most people do not know about, and from the very onset, you & your beneficiary are fully secure. This is your fund being saved and as soon as the policy expires, you are eligible to the fund plus return accrued on your investment.

Joining a retirement scheme: There are actually options of putting aside some good money for savings via a retirement scheme, and without having to worry about some bureaucrats sorting your document & disbursing payment. Such schemes welcome you to bring in whatever you agree upon on a daily or monthly basis & the fund will be further saved for retirement, for you.

CDs (certificates of deposit): The advantages of using CDs might not be that obvious directly. To some folks, these channels might even seem like a marginal scam. Well, it’s better to save some money through CDs and forget about it, than keeping such money in a standard savings account where you might be tempted to dip into it easily whenever your other checking account is depleting. Simply put your money in Certificates of Deposits & it will be intact when you need it. Long term CDs with periods of say between 3 and 5 years usually have much better annual percentage revenues than majority of the best savings accounts out there. Even when it has to do with short-term CDs, such approach still will aid you in attaining more immediate savings goal lines.

Use a prepaid card to control your spending and save more: When you go out on vacation and you become tempted to spend on overpriced products and items, a prepaid debit card can come in very handy. A prepaid card doubles as a budgeting tool and a prudent payment method. Distinct from other payment cards, a user can limit his or her expenditures to just the money loaded on the card, meaning that you won’t require looting your savings to cover next month’s credit card charges. Want to save more money, then consider some of the best prepaid debit cards which of course come with no monthly fees.

What does saving money for a rainy day mean?

 

Saving for a rainy day means saving some funds for imminent times ahead of you. It actually implies a time of need. It might be saving for a goal or saving for vacation; just whatever comes on the scene. Whatever the goal is; it is good to know that saving for the rainy day will help you accomplish your aim, as you will be able to also handle emergencies when you unexpectedly find yourself in dire need of emergency funds. Really, none of us know what will occur in the next hour, much more in the looming future, thus even if you are living financially okay at the moment, anything could happen and you should be on guard. Even majority of the wealthiest individuals in the globe have found themselves going bankrupt after an alteration in financial markets or due to poor spending. In any way, saving is clearly a very positive thing to do with your fund, and it doesn’t matter if you end up needing to access it or not.

While saving for the rainy day will prove to be beneficial someday, it will also help you earn money with good interest rates coming in from your savings accounts. This means your money will gradually increase, whether you top it up or not. Saving money for the rainy day all through your life period – is very crucial for retirement. A large volume of individuals don’t have sufficient money saved for retirement, thus saving for that rainy period can be very vital. What you save will help keep money aside for the future and also take care of short term emergencies such as related to family education, homes, vehicles, and most essentially retirement in the long run. To save for the rainy days ahead might not be simple, however – it is possible. The only way to get it in line – is to begin saving a little at a time. As soon as you generate a budget within which you can survive contentedly, you might decide looking at ways of cutting back on other expenditures & then building up more income.

 

Saving money when you are broke or when living paycheck to paycheck?

This section shows you simple ways to save on both sides (whether broke or on paycheck)!

Below are a few ways in which we can recommend how you can save when you are living paycheck-to-paycheck.

Learn to negotiate bills: There is great power attained when it has to do with negotiating your bills, and it is something everyone needs to know how to do efficiently. One trick is to communicate with majority of all the places that forward you monthly bills comprising those of (gas, electric, internet, and security system, among others) and tell them that you are having challenges paying their bill at the end of every month. You can then proceed to mention that you would love to continue utilizing their services; however you are aware that you can as well receive same for lesser price elsewhere and wouldn’t mind canceling it altogether. You will be surprised at the volume of discounts and support you will get! So as a paycheck to paycheck survivor, if you practice this one simple act, you will be shocked about how many discounts are available when demanded.

Learn to shop around for new companies providing the solutions you might already be receiving elsewhere; you will be amazed that you are paying way too much to your current provider.

Note that you never might know, except you try; so please do!

Look for a smaller location: If you live on paycheck-to-paycheck, it is likely that you dread paying your rent just as several others are. When you seek out for a smaller place for your apartment or rental home needs, this is a great way to reduce your monthly dues – simply freeing up space to conquer the paycheck-to-paycheck sequence.

Check with your finances: This is likely one that you don’t wish to read about. It is assumed as boring, hard, and even depressing. However, the truth here is that as soon as you know where you have struggles with your budgeting, you will be able to work on such, much easily. More than assumed, it isn’t the biggest expenditures that actually drain your budget but it is a sum total of all of the small expenses that gradually eat away at it. For some folks, it could be starbucks, while for some others – it could be jewelry, video games, sweets, pastries, donuts, and ice cream, among others. And the funny part and I will call it deceiving – is the point that we all sometimes say – these only cost a few bucks like $1, $5, $10, … You strongly need to look deeply into your budget and find out what it is that is silently draining your account, bit of cents and dollars per time. You can get your bank statement printed & observe where your money is going.

Likely, it could be that you do not have anything to show for – due to the fact that all of your money is being used up on credit card interest.

Having a new separate bank account: When you open a new separate account – this will help you monitor positive progress and thus generate the initial crucial momentum, which will see you through the entire process. So for the starter, go get a new bank account, if possible – one that’s more difficult for you to withdraw cash from. The monies you realize from the above tips such as accrued from credit card adjustments, bill reductions, among others – can be sown into such bank account.

Ways to Save Money When Broke

It can be challenging to save cash at any given time, however, it is chiefly difficult to do when you feel like you are broke. If you can hardly handle your bills & you are living hand to hand, saving money is likely one of the very last things that will be on your mind. Though – you can still save loads of it when you are broke. In short – saving money, even if it is small, is a key step to overcoming being broke.

In as much as you are making some cash, you should be gladly saving some part of it. Particularly if you more often than not have insufficient funds, it’s essential to generate a behavior of saving money. In spite of the fact that you have little extra cash, there are means to save. When you cut costs, stick to a pre-defined budget, & save a bit at a time, these are all means to help you save money, among several other ways. Consider the following tips:

Cut off extras: A simple method to save cash when you are broke is to do your best to cut expenses. You might assume that there is nothing you can cut out initially, however, please think a bit deeper. If you are really “broke” – you need to take quick steps and permit certain things to go. Things such as expensive cell phone plans, cable television, and internet – among others can be handled judiciously to minimize costs. Certain things that are mostly considered as necessities happen to be really just extras, & reducing few of them will swiftly free up more cash. Consider your monthly bills, & choose what is truly required. If you desire to stop being broke, then think through cutting out some of the extras, and you will be glad you did. Evaluate your spending habits.

Eat at home: Getting a quick lunch on the go can be much easier & more suitable than bringing a lunch to workplace. Well, doing this all the time will hugely eat away deeply into your income. According to research, it has been observed that eating out is a common way individuals fall into personal debt. While it is rational to eat out because you are so preoccupied to cook, please note that preparing food at home will ideally save you cash, thus if you desire saving money, start making out time & effort to cook at home. How about saving time by preparing various meals during the weekend & freezing them up to utilize all through the workweek? And if you don’t know how to cook, you can simply purchase a good cookbook for beginners.

Create a budget: If you do not have a budget, your primary step should be to create one. Likely – you by this time have a budget, however there are various reasons a budget can flop. If you presently lost a job, or you now have a different lower income from what it used to be, and you are utilizing same budget, this is the time to create a new one. You essentially require looking at your budget & finding out if it is actually reasonable & if you need to fine-tune anything.

Save a bit per time: If you are totally broke, the notion of saving anything likely appears unrealistic. Well, you have to get into the habit of saving should you desire attaining certain goals. It is thus imperative to consider the future. You can jot down your financial objectives, even if they appear entirely out of reach. And then, start small, start saving. As soon as you cut your extras & begin following a budget – you can utilize few of the discretionary cash to save for your future.

Avoid common mistakes: You can generate loads of great ideas and decisions about your finances, however if you make a few poor miscalculated steps, you will still have difficulty, saving.

 

How to save money fast

 

Cut unused subscriptions

 

There is a subscription service for almost all stuffs nowadays, right from Television to fashion/beauty items to food. Majority of them do not cost much per month, though they can gradually add up. The deal is for you to create a list of every of the service you are subscribed to, comprising Internet, gym memberships, etc., and reevaluate on such subscription(s). You can opt to cancel it, or find out if you can get a cheaper alternative.

 

Cell Phone bills

You have to shop for the best, yet affordable phone service provider. Also you have to avoid unnecessary calls so as to minimize fees.

 

Bank fees

There are several bank fees associated with our bank account activities. You can minimize these bank fees by stopping to write checks and going for paying electronically using debit card, credit card, or electronic bill payment. Checks are costly, bearing in mind what they are.

Internet Cable fees negotiate to lower it

Call up your internet cable provider and discuss the potentials of getting some discount. You can entice them by saying you have a proposal from another company for much better offer; and many times, they will succumb and offer it to you.

 

Sell Something

Selling products/items helps you acquire more money and with a saving goal in place, this will help you save and attain goals much quicker.

 

Save money with cashback, rewards and loyalty programs

Check out reward and loyalty programs online. There are several cashback benefits that you can benefit from if you look out for them. These will help you minimize expenses and offer you some extra funds for saving.

 

Lower your APR

 

You can lower your APR by opening a credit card that offers an introductory 0% deal.

Here, you have to take heed to make your payments on time, as missing just one – might cause your introductory deal to be annulled, & interest accruing right away.

You can call your credit card provider to discuss your APR as this is yet another choice if you can’t qualify for a 0-percent credit card. Most of them might reach a decision to reduce your interest rate so as to keep your business. Alternatively, they might decide to transfer you to another product with a much lower APR.

Try to boost up your credit score – as this goes a long way toward assisting you qualify for a lower APR on credit cards.

Refinance your property

 

Basically, property refinancing is one of the most efficient means to release cash, minimize monthly expenses & enhance your financial position, as it provides much extra cash for usage and saving; that’s when implemented rightly & for the appropriate reasons. Property refinancing, in several scenes – will help minimize bond repayments significantly, a good reason why several folks opt to refinance their properties. When you refinance your property, you will be securing a new mortgage for it – contingent on its present worth, & not on the value it was estimated when you took out your primary loan. With this, you gain access to equity which you can utilize to improve your living standard & boost your financial status.

More Ways to save money

  • Turn your thermostat down 3 degrees

The deal here is that you can save around 3 percent on your heating bill for each degree you set back your thermostat. So learn to do it!

  • Sell something on eBay today

Anybody can sell anything. So get an account with eBay and sell something you have probably been desiring to get rid of, or anything you can buy cheap and flip for a bit more income. This will psychologically commit you to saving money.

  • Involve your friends in your savings challenge

By involving your friends in your savings pursuits, you eradicate that lack of discipline & offer yourself the stage for accountability to win.

  • Optimize your cellphone bill

Negotiating your wireless or data usage bill with your phone provider is one way to enjoy special discounts and save the extras.

  • Use gas prices to become your own hedge fund

You can generate an automatic transfer of cash that you’re saving and fix it in a “fuel hedge” account to secure you when gas prices upsurge. You can read more of this here

  • Create a “No Spending” day once a week

Majority are wired to spend almost on daily basis, even if it’s the smallest things like candy or popcorn. You can save some of these expenses if you practice not spending for at least one day.

  • Only purchase new things when replacing something old

Some folks just keep buying on impulse modes and this will hardly allow one to save. The appropriate thing to do is to only shop for a new item when it is time to replace the old one.

  • Use the free rewards from your credit card, car insurance, and workplace
  • Never pay full retail price for clothes or eyeglasses again
  • How you can save $2,000+ on eating out

You can save so much money on eating out by utilizing services that deliver amazingly reasonable discounts. You can utilize coupons at a restaurant.

  • Negotiate your car insurance

You need to find out about what sort of coverage you presently use & how much you are paying. Make out time to shop around, and find out about deals via phone from insurance reps.

  • Utilize self-persuasion to share your savings journey

This tip requires you writing down how much you must have saved thus far in the journey. This will help motivate you and others to save money.

  • Forget going to a bar — ask people over for dinner
  • Cancel any large purchase this month
  • Purchase generic for the stuff you don’t care about
  • No Christmas gifts this year

Look at folks in the eye and tell them: “Hey look, things are quite on the hedge, so I won’t be able to buy you a gift like I wish to, however I’d love to help you out around the home or host a dinner to catch up. You are likely to gain their respect more for being frank.

  • Save thousands by pre-paying your debt
  • Go cash only for 15 to 30 days

Why you use cash instead of credit cards, you cut your spending. It helps you become more conscious as a spender. The psychology here is that every dollar you find yourself physically spending will cause you pain; the kind that will help you spend less, save more.

  • Cut your commute expenses by 40%
  • Earn more by utilizing your God-given skills

Everyone has got some gift and skill, so you can get started with freelance jobs and earn some more money to enable you save something!

  • Use price-protection guarantees to grab the lowest pricing

With price protection, this allows you secure yourself from price drops, meaning – if you purchase something & the price drops – the providing company will refund you the price differences.

More Money Saving Tips: How to budget money

A budget in place helps you win over outstanding debt and helps you take charge of your financial life & future and makes you stay happier, and a more relaxed person. A well driven budget may not necessitate you spending lesser, rather may just require you making more effective financial choices.

First deal would be to – Assess Your Financial Situation

Carry out an assessment of your income & outlays. Doing this will help you generate a reasonable and realistic budget that will in turn help you spend less & earn more.

Categorize Your Expenditures

Categorizing your budget will aid you prioritize your finances, and thus help you plan well towards your savings goal.

Identify Your Problem Spending Pointers

Recognize your spending habits. Are there any particular shops you frequent? Have you become addicted to coffee; likely this can be reduced or cut out, among other pointers.

Our Recommendation for effective saving, budgeting and investing through COURSERA Online Courses:
Financial Planning for Young Adults

About this course: Financial Planning for Young Adults (FPYA), developed in partnership with the CFP Board, is designed to provide an introduction to basic financial planning concepts for young adults. The FPYA course is organized across eight separate modules within a 4-week window. Topics covered include financial goal setting, saving and investing, budgeting, financial risk, borrowing and credit. Because financial planning is such a personal topic, you will be encouraged to define your own financial goals and objectives while we discuss concepts and provide tools which can be applied in helping you reach those goals. Within each module, you will view a combination of traditional lecture style videos along with video vignettes that introduce financial topics for discussion among participants. The video vignettes provide a unique and exciting component to this course. Each vignette introduces a real-world scenario where financial decisions must be made and financial planning concepts can be applied. You will be challenged to think critically about each scenario and decide how you might come to a resolution if ever faced with a similar situation. Finally, the course also includes material throughout which is focused on career opportunities in financial planning, including video interviews with actual CFP® professionals and other professionals working in this exciting and growing career area. The final module in the class is devoted to the topic of financial planning as a career. Go here now to start Financial Planning for Young Adults

 

Personal & Family Financial Planning

About this course: Personal and Family Financial Planning will address many critical personal financial management topics in order to help you learn prudent habits both while in school and throughout your lifetime. Go here now to start Personal & Family Financial Planning



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3 Comments on “Are millennials saving money? How to grow wealth efficiently”

  1. Haha, i like this. i have been saving for long just that i don’t have enough discipline to keep at it correctly. having read this content today, i have now gotten a new perspective for the long term; that’s saving for the future and not just saving to take care of necessities.

  2. Millennials should find this very educative and helpful. Thanks for this – at least I know where to start from and what to do.

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