Money Management for Millennials: Top Tips to Keep in Mind

Millennials, or those in their mid-20s and late-30s, account for nearly 27% of the current global population. A recent study revealed that the COVID-19 pandemic had changed the way millennials look at money. 

While they earlier believed and practiced the buy-now-pay-later-policy, they are now considering saving for the rainy days. It’s safe to assume money management has become a priority among millennials nowadays. 

Thankfully, there is no shortage of investment management strategies they can now look into. Not only that, there is also no shortage of money management tips that will not only help them survive the crisis but also prepare for other financial uncertainties.

Below are top money management tips for millennials:

Create a Budget

If you want to manage your money accordingly, you first need to have a clear insight into your income and expenses. List down all your expenses for the month and divide your list into essentials and non-essentials.

List all your income sources as well, including your salary, dividends, rental income, interest on deposits, etc. Your monthly budget can help you understand the flow of your funds monthly, both incoming and outgoing.

In addition to creating a budget, you also need to set aside time each month to find non-essential expenses. Once you have successfully identified them, remove them from your list. It is also essential to find new and additional ways to save money each month.

Be Financially Literate

Unless you invest in the services of financial experts, you will not know all the risks involved each time you invest your money. While you don't have to be an investment expert, you should at least teach yourself personal finance basics.

For starters, learn the essentials of mutual funds, figure out how systematic investment plans (SIPs) work, examine the importance of insurance, etc. When you know the basics of investing, you will be able to make better  investment decisions.

Make Meaningful Investments

Money that's lying around your house or money in your savings account can barely cover the effects of inflation. That said, aim to make meaningful investments as often as possible. Many people set aside money in liquid funds while investing the others in different goals.

Keep in mind that the primary purpose of keeping a savings account is to keep your money safe and not earn from it. If you want your money to grow, consider investments like mutual funds. You can also seek the help of a finance expert for guidance and advice.

Create Long and Short-Term Goals

A good financial plan is made up of two goals—short and long-term ones. Short-term goals can include buying a new gadget, purchasing a car, or planning for a vacation. Long-term goals can include children's education, marriage, or retirement.

Ensure you allocate funds for various goals accordingly. It is imperative that you also remember that long-term goals will take years to accomplish. It would also help to have short-duration milestones, so you stay motivated.

Practice Proper Money Management At All Times

You cannot practice proper money management and financial wellness for just a few months or a few years. Also, when starting out, you can't expect to become an expert investor right away. 

However, you can always invest in financial services or learn how to do it properly as you go along. If anything, the more experience you will have, the more additional income you can easily and successfully generate.  

Over to You

Nowadays, it is reassuring to know that wealth management and financial experts are scrambling to cater to millennials and help them invest their money accordingly.  This means with some financial discipline, careful selection of investment instruments, and expert guidance, growing your wealth into a considerable amount should come easy.

About the Author:

Rachael Harper is the Content Marketing Strategist of Bennett & Porter, a wealth management and insurance firm based in Scottsdale, Arizona. When not writing, she makes use of her time reading books and playing bowling with her family and friends.