Common Millennial Money Mistakes
Overspending and misusing credit cards
Ok, this is a big one. Overspending and racking up credit card debt can and will ruin your finances. If you don’t make the payments on time, then you’ll accrue a ton of interest and your credit score will take a hit. If you only make the minimum required payment, you’ll fall deeper into the hole. Save yourself the trouble and (if you can help it) only charge what you know you’ll be able to pay off each month.
Not creating, maintaining, and sticking to a budget
I cannot stress the importance of budgeting enough. You need to plan and know where your money is going. Without a budget you won’t be able to address and fix your cash flow issues.
Not saving enough (or at all!)
If you don’t already have a savings account, open one. ASAP. Start putting money into it consistently. Save as much and as often as you can. Work on building an emergency fund so you have something to fall back on just in case.
Holding off on saving for retirement
We have 30+ years until retirement, so we can wait and save later right? Wrong! Take advantage of time and start saving now. If your employer offers 401(k) with a match, don’t leave that free money on the table. Time is on your side, and you’ll be thankful for an early start as retirement nears.
Not investing and taking risks
When you start saving for retirement and want to invest and grow your savings, don’t be afraid to take risks. Higher risk investments bring about higher returns. Diversify your portfolio and make sure it includes some high risk, long term investments. There will be highs and lows in the short term. As long as your investment isn’t completely tanking, then let it ride. Also, don’t ever put all of your money into one investment.
Not paying attention to credit score and credit report
Check your credit report at least once a year to make sure that everything on it is accurate. If you find anything that is inaccurate, dispute it. Your credit score will be increasingly important when you want to buy a car, rent a place, etc. If your score isn’t where it needs to be, start working to get it up to par.
Not negotiating (salary, rent, car price, etc.)
Not negotiating can cost you a ton of money. It can be tough to work up the nerve to negotiate, but try your best to make it happen. Do your research and if there’s some wiggle room (and there often is), then negotiate!