This post may contain affiliate links. Read our affiliate disclosure here.
As the parents of millennials, we are always trying to encourage our kids to learn from our mistakes and be more financially sound than we were at their age, to make it easier on them in the future. It’s really difficult getting them to understand the importance of being on top of your finances! Here are 7 tips from parents and grandparents millennials should live by.
One: Start Saving for Retirement RIGHT NOW.
This is so important. My oldest daughter is 24 and she just started an amazing job that offers a 401k and shareholder options. I might have told her that if a company offers a 401K it is mandatory to participate, but the fact is that she is participating! It’s really hard for kids to give up “fun money” to plan for something that is 50 years away. By starting right away it becomes second nature and they won’t miss them money that wasn’t in their paycheck in the first place.
Two: Get Handy.
I cannot tell you how many people I encounter who cannot perform simple home repairs, like fixing a leaking faucet or changing a light fixture, who think nothing of calling “the guy” to come and do it for them for big bucks. Over time being a DIY’er will pay off tremendously. Learn how to do basic car repairs, home repairs and maintenance by asking someone who knows what they are doing to “tutor” you, or watching YouTube videos. If it can be done, chances are there is an excellent YouTube tutorial to walk you through the task. Take the money you would have paid a repair person and save it instead. It adds up fast!
Three: Learn How to Cook.
Preparing your own food can save so much money over time, and nothing blows the food budget faster than deciding to go out to dinner or pick up take-out a few times a week. Your meals don’t have to be restaurant quality, but everyone needs to know how to make a few basic meals to carry them through the week. And everyone should have one dish they can make perfectly every time that is their “dish to impress.” Whether it is for someone you’re dating, a dinner party with friends, or your partner’s parents, being able to cook one meal really well is really important. My husband makes a killer fettuccine Alfredo with garlic chicken. That’s it. And that’s ok, because it’s really good and I can count on him to whip it up if needed.
Four: Don’t Worry About the Jones’.
After all, they aren’t worried about you! Worry about yourself first and your friends later. They may drive better cars than you, live in nicer homes and have fancier items, but you have no idea what their finances are like. Are they in over their heads? Did their parents gift them funds to buy their house? Who knows, and more importantly, who cares? You do you, and be sure that in doing so you aren’t painting yourself into a corner that will take years to crawl out of.
Five: Don’t Become House Poor.
Just because you can afford something doesn’t mean you should buy it. If you can “afford” a $400,000 house, can you afford to do anything else after you buy it? Like furnish it? Pay the real estate taxes when they increase? Go on vacation? Put on a new roof? The old saying “buy the worst house on the best block” still holds true. See #2 above and you’ll be able to turn the worst house into a great house- and that will pay off big time!
Six: Consider Letting Other People Pay Your Mortgage.
Sounds pretty good, doesn’t it? I don’t have many regrets, but real estate is definitely one of them. In hindsight I soooo wish I had done what my grandparents did and bought rental properties. A two or three flat, so that the tenants could cover the mortgage and taxes while we lived at the property, in the city would have been an awesome investment. Nowadays, my grandmother is sitting pretty in another state while her buildings produce an income for her.
Seven: Keep Your Most Important Expenses as Low as Possible.
Most people’s most important expenses are things they need, not things they want: Housing, Transportation and Food. These three expenses aren’t going anywhere and are likely your most expensive. Keep all of them reasonable and you will have more money, and be happier, in the long run. Would you rather have a nice apartment with a great view for $2200 a month, or a great apartment with no view for $1500 a month? That extra $700 can go towards paying off student loans, savings, vacations, whatever you want. Is the expense really worth the “view?” Probably not. (See #4.) Keep your housing expenses down, drive a reasonable car or use public transportation, and eat at home more often and you will be able to keep your most important expenses as low as possible.