Millennials are a unique generation. With so much economic turmoil in their lifespan, as adults millennials face a wealth of financial roadblocks (no pun intended). Between the 2008 crash, college debt, and current economic challenges, many millennials financially live in the present. According to a 2022 report by the Morning Consult, millennial financial well-being remains lower than the national average.
Given this data, it’s little surprise that many millennials push off their wealth management “for the future” in favor of focusing on the present financial woes.
For millennials in this position, there are still a few wealth management tips you can follow to help ease some of that financial anxiety.
Wealth Management Tips for Millennials
1. Know the different types of debt
A lot of financial advice starts with “try to pay off debt.” Most millennials know this is their goal, but find it insurmountable to climb out of all debt.
First, it’s important to understand the different types of debt so you can make a more realistic plan for payment. Some types of debt generate higher interest rates than others, so it’s a good idea take a look at your debt and chart the following:
- What are the interest rates? (Or are there no interest rates?)
- Is there a deadline for repayment, and what is that date?
- How much is the amount owed?
From there, you can truly make a plan to prioritize paying off debt. Anything with a high interest rate and/or soonest deadline should be your top priority.
2. Make short-term and long-term goals
Sitting down and creating specific goals for both the short-term and long-term give you something concrete to work toward, versus a vague goal of “pay off debt” or “save money.” Short-term goals should have an end date, be achievable, and specific. It can be as simple as committing to setting aside $X amount each month for your savings account.
Long term goals can be hard for millennials who are facing more immediate financial struggles. However, having these goals in place creates a pathway forward, and makes it easier for you to hit your short-term financial goals.
3. Learn about savings and investment options
Even if you’re already setting aside money each month for savings, it pays (literally) to be know about the options available to you. For many millennials, Tax-Free Savings Accounts (TFSAs) and Registered Retirement Savings Plans (RRSPs) allow for the best growth over time. However, your situation might be different. Take a moment to review all your options – a great place to start is with your current bank and what types of accounts they offer.
4. Contribute to your employer’s 401(k)
When you’re facing financial woes in the present, it can be extremely difficult to plan for the future. However, if your employer offers a matched 401(k), not contributing is missing out on potentially thousands of dollars.
5. Ask for help
At the end of the day, you don’t know what you don’t know. Financial literacy is hugely important, but it also takes time to develop. Do some of your own research by reading free online resources that educate about financial literacy (like this blog!). The Motley Fool and NerdWallet are fantastic resources for learning about all things finance.
And it’s ok to ask for help. Working with a financial advisor is another critical way to empower your financial future. These experts know the ins-and-outs and can provide you concrete, specific advice for your situation and long-term goals.
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Our financial advisors at Greater Midwest Financial Group are committed to helping you balance your present and future finances so you can live comfortably and confidently well into the future.
Greater Midwest Financial Group is a financial advisor firm serving St. Paul, Minneapolis and the wider Twin Cities area. We specialize in wealth management, retirement planning, asset management and other personal finance needs.
Photo by William Fortunato
