Millennials are a smart bunch, but often not so much with money
Making up more than a quarter of the U.S. population, Millennials are a force to be reckoned with, and if you aren’t in this demographic, you surely know somebody who is. While there are many positives associated with this group – Millennials are killing it with entrepreneurship, for example – many still have a lot to learn when it comes to finances.
Here are six areas in which Millennials could – and should – make improvements:
The rent trap
A large portion of Millennials may not be financially ready enough to buy a home, but quite a few continue to rent even though owning a home is feasible. It can be easy to get complacent in a rental situation, especially when you’re not responsible for any maintenance, but owning a home is one of the best ways to build up equity.
Low credit scores
When it comes to credit cards, Millennials use them more than any other group. While this alone isn’t necessarily a negative, this is: they often have a hard time paying their bills on time, and this leads to lower credit scores.
No emergency fund
A shocking amount of people wouldn’t have even $500 available if there were an emergency. Because many Millennials feel the need to keep up with the Jones when it comes to cars, tech (and everything else) they may not even have that much on hand.
Bad budgeting
Millennials may think they have a pretty good idea of what they buy and how much they spend, but they are often wrong. To make matters worse, actually taking the time to create a budget is often a foreign concept to them.
Lack of retirement savings
Most Millennials want to stop working by the time they’re 65, but reportedly only about 30 percent have actually started saving for retirement. Not enough are taking advantage of their employers 401(k), they haven’t set up an IRA account, or they’re not making regular contributions.
Disregarding life insurance
Perhaps it can be blamed on the feeling of invincibility of youth, but Millennials by and large don’t see the need for life insurance. Especially troubling are the people with families who keep putting it off. For young people in good health, life insurance is very affordable, and it can be so important if calamity strikes.
It won’t be long until Millennials pass Baby Boomers for the largest demographic in the U.S., but if they want to have a comfortable life for the next 50 years or so, they have to get smarter with their money. When it comes to providing life insurance, Avante can help. To get started with the process, contact us. We also offer an assortment of other insurance options, including policies for home, auto, and business.