Author: Benjamin Lee
From making the rent to shopping for groceries and paying off study loans, putting aside savings is nearly impossible for millennials. With a weak economy and poor job prospects, it’s a wonder that any of us are still surviving.
While it may be easy to blame all of these on poor financial management skills, this simply is not true. Despite an increase in median household incomes over the years, soaring college fees and car and property prices mean that most millennials are firmly anchored in debt. Consequently, this makes it impossible for them to have savings of any kind.
However, there is still hope on the horizon. Despite rising unemployment and soaring costs of living, it is still very possible to have some savings put aside. Here, we’ve put together a simple guide to help you have some cash in the piggy bank.
1. Put aside 10-20% of your salary each month
Call it a tax upon yourself or a forced savings scheme, either way putting aside at least 10% of your salary each month is a great way to start saving. Deposit the self-imposed 10-20% tax each month into a separate savings account via auto debit each month. Before you know it, you’ll have a fair sum put away.
2. Sign up for an IRA account
From the moment you land your first job, you should always check to see if your job has a 401k plan. If it doesn’t, sign up for an IRA account as soon as possible. Treat it your IRA deposits as just another expense and you’ll find putting aside some savings is quite possible.
3. Avoid credit card debt like the plague
A study conducted by the Federal Reserve Bank of New York has revealed that a whopping 55% of American households are in severe credit card debt. With the extortionate interest rates charged, it’s easy to see how outstanding credit card debt can easily balloon out of control.
As a rule of thumb, always pay off any and all existing credit card debt at the end of the month. This ensures that you’ll never be bogged down with interest payments. Also, paying off your credit card debt on a timely basis helps you develop a solid credit history.
4. Take on a side-gig
Sometimes, a single income stream just isn’t enough. Fortunately, in today’s world there are plenty of opportunities for those willing to look. An example of this can be seen in the active freelance market.
Thousands of copywriters, designers, accountants and even virtual assistants are hired on a daily basis on sites such as Upwork.com and Freelancer.com.
Sites such as these allow you to monetize any of your skills. By taking on a side-gig or a series of freelance projects, you’ll be able to grow and multiply your income streams. Put aside your earnings from these jobs and deposit them into a savings account.
Over time, you’ll be able to save up a surprising amount of money. In some cases, successful freelancers have been known to turn their side hustle into a successful full-time business.
If you fancy sports, look out for online sportsbooks. They might offer some rewards and they have promotions and bonuses for newcomers. However, remember to wage responsibly, so you don’t lose more money than the one you are betting.
5. Audit your expenses
Auditing your personal expenses can be tough. However, by taking a look at your expenses over the previous 6 months, you’ll be able to identify areas where costs could be reduced. Whether it’s skipping on eating out or giving Starbucks a pass, you’ll find that even the smallest expenses do add up.
While it may initially seem like an insurmountable task, it is very much possible for you to have a healthy savings account. With the right combination of self-discipline and consistency, you can make saving a part of your lifestyle.