Millennials’ saving habits are often criticized by other generations. However, millennials also face many financial burdens other generations have not had to face. Saving money can be the difference between debt and financial independence. That’s why we urge every millennial to start making their saving a habit today.
Source: The Financial Brand
What do these statistics have in common? Most millennials want to make smart money decisions and save their hard-earned cash, but many are at a loss of where to start or how to make an actual difference. If you or someone you know are struggling to make savings a habit, use these 3 tips!
It really does help to evaluate your current situation before committing to any goals. You have to know your income, expenses, and how much money you can realistically dedicate to saving before it can become a habit.
Start out by brainstorming why making saving a habit is important to you. This will be your main motivation when you are tempted to cheat. Then create your budget. Budgets are essential tools to tracking your monthly income and expenses.
If you have never created a budget before, read The Beginners Guide to Creating a Budget. If you have some experience and want to jump straight to filling in your numbers, download our free budgeting template here.
Use your motivation and your budget to set a monthly savings goal. Make sure to leave room for fun expenses so you don’t get burned out on frugality. Start with a small goal, and as you achieve it, it will make it easier to increase the monthly amount.
Once you have created your budget, know your motivation for saving, and have decided how much you can realistically add to your savings account each month – it’s time to automate the process. Here’s how.
Pay yourself first! Set up your paycheck’s direct deposit to split up your income into two accounts – your checking account and your savings account. The amount you have elected to save will automatically end up in your savings account. Setting up this service is easy, you just have to ask your HR department what paperwork they need.
Automating saving tricks you into making it a habit. You don’t actually have to put in any effort to switch money around within your accounts. That’s why we always recommend this method first.
Automating your savings isn’t the only option. The best advice we have for turning saving into a habit is to find the technique that works for you! Everyone’s mind works differently, and different financial situations call for different approaches. There’s no one size fits all solution.
Find out 11 ways to trick your brain into saving more money here. Two are our favorites are naming your savings accounts to remain focused on your goals and kicking off your savings with a competition or challenge.
If you think you need some outside help to change your savings habits, it’s free for members to meet with our credit union’s experts. It can help to get an outside, professional opinion on the best savings plan for your unique goals.
Leave your favorite tips in the comments below. And send this article to a millennial in your life who could use these money tips!
Many times, the lack of savings is the direct result of a large amount of debt. If you want to finally eliminate your debt and reach financial independence – we have the guide for you. Read “Live Debt-Free: Your Guide to Eliminating Debt.” This guide is FREE to anyone who wishes to download it. Read the guide now!