5 Money Management tips for Millennials

Millennials, or people born between the early 1980s and the early 1990s, face a much different economic future than that of their parents. As the wealth gap widens, Millennials are up against an ever-challenging economic landscape as they move through their adulthood.

We look at 5 tips for Millennials to help manage money. By adopting some or all of these tips you could set yourself up for a more prosperous financial future…

1. Looking at ways of managing your costs

Don’t worry this part isn’t going to be about stopping buying coffees or avocado on toast or whatever the latest cliché about Millennials is. Cutting costs doesn’t have to mean missing out on your weekly treats.

The covid19-related lockdowns during 2020 and 2021, showed many employers and employees that it was more than just possible to work away from the office, but that also that it was possible for employees, and especially Millennials, to work from anywhere, such as coffee shops and shared facilities closer to home, which shifted how many people spent their money. Instead of paying for the costs of commuting to the office each day and pricey lunches, people were now spending money on improving their home office environment, in shared workspaces or coffee shops, and saving money making their own lunch.

What’s important here is that you’re aware of and able to keep track of where and how you spend your money now, so you can make informed decisions on where and how you choose to spend it in the future. After seeing how much you spend on that morning coffee once or twice a week, you might decide that that’s actually a luxury worth keeping and to find some way to save elsewhere.

There are a lot of great apps on the market that will help you with saving, planning and budgeting. Some, if not most, are free and allow you to link all your bank and savings accounts in one app to get a full picture of your finances. Many mainstream banks already include this functionality within their banking app.

2. Find ways to cut unnecessary costs

This is about making savings where you can, without necessarily sacrificing your comforts. Some simple ways of doing this are by:

• switching to non-branded or own-branded products in the supermarket
• looking out for free offers and money saving tips
• test out a weekly shop at a cheaper supermarket like Aldi, Lidl or Costco
• buy a hair trimmer and cut your own hair or start dyeing your own hair yourself

Cut down the costs you decide are not a necessity and not only will you save money, you’ll be keeping yourself informed and in control.

3. Stop paying interest on your credit card debt

If you have credit card debt, put a strategy in place for paying it down and getting rid of it. There are often several 0% credit card offers from major banks and other providers that let you transfer your existing balances to their 0% card. This will save you a ton of interest for a fixed time (some up to 30 months, but the average is probably 18 to 24 months) and allows you to make a real dent in your debt by paying down a set amount every month, although you might want to consider setting up a direct debit instruction to avoid missing minimum payments and being hit with late payment charges.

Once you switch, you should:

1. Look on your card statement for the month and year when the 0% ends and do 2 things — go to your calendar app in your phone or alternatively go to your email program on your PC, and set up a reminder 1 to 1 and half months before the 0% offer ends to remind you to start looking to switch to another deal! (If it still looks like you won’t have the debt paid off in full at that time).

2. On the front of the card with a permanent marker, write the month and year that the offer expires, so when you need to recall later, it’s right there on the card.

3. Do not use this card to make purchases. In fact, do not use this card at all! Once you’ve written down the deal expiry date, file the card away somewhere.

Some cards come with what appears to be a small balance transfer fee, somewhere up to 3%, however this can detract quite significantly from the amount of interest you’ll save as, although 3% sounds small, for every $1,000 transferred that’s $30 in fees you’ll have to pay. SO firstly, look for and apply for those cards with zero balance transfer fees.

So, where to find these 0% balance transfer cards? Try using a comparison site such as Bankrate.com if you’re in the US, or moneysavingexpert.com if you’re in the UK.

4. Use a VPN and an incognito browser

Going incognito when you shop online can help you save money by automatically deleting your browser history after you close your browser, which means companies can’t track what you’re looking at and put prices up. It’s what’s called “dynamic pricing”. This is an especially common trick used by airlines, hotels and travel booking websites but increasingly by many other online retailers.

Arizona State University Assistant Professor of Information Systems Dr. Victor Benjamin explains:

“They do it… by tracking your individual computer, dropping cookies on it or looking at your browser history. They may also just look at your IP address. So, if you were using Safari as your browser, they assume that you were using an iPhone or Mac. And, perhaps, you are from a more affluent background. So, they would actually price accordingly and try to sell you a more expensive ticket than, say, if you connected to the same airline website using something like Firefox or Google Chrome, for example.”

Using a VPN can also save you a huge amount on the price of anything from Apple music and other subscription services, streaming video services, flights and car hire. Again, because online companies use dynamic pricing based on where you live, by using a VPN to change your IP address location to a country with a lower average income, you can save you hundreds of dollars.

You can either subscribe to a VPN service by paying a fee, or alternatively some VPN companies like Hide Me or Windscribe offer up to 10GB a month free usage, so it doesn’t have to cost you, although the choice of which countries you can VPN through is limited.

5. Cancel unnecessary automatic payments

Automatic Payments or Direct Debits, are instructions on your bank account authorising a company to automatically deduct money from your account at certain intervals, like your electricity supplier for example. Like small leaks, any unnecessary or overpriced payments could be contributing to a huge drain on your finances.

Get into the habit of checking your bank and credit card statements regularly for any auto payments for services that you don’t need or use anymore and ones you may have forgotten to cancel. They could be streaming services, online subscriptions, gym memberships and insurance payments for example. If you’re no longer in contract for these payments and there’s no notice period required to be given to the supplier, contact your bank about cancelling these financial leaks.

Conclusion

Managing money during current times of rising inflation, increasing movement towards digital technology, and remote working options means that the economic world facing Millennials today is hugely different to that of their parents, but by adapting and finding ways to manage your finances you should be able to cut some of your costs and regain some more control over your finances, without having to sacrifice too much of the things you enjoy.

Hope you found this post/video useful, let us know in the comments if anything stood out as most interesting to you.

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