Three Money Mistakes Made by Millenials

Each generation wants to be more successful than the last, whether that is making more money, having enough to retire, or a home to be proud of, but it does not see like we are headed in that direction.  Whether you are just entering the workforce now, need to make adjustments to your spending habits, or looking for advice to pass down to your children, it is never too early to prepare for your financial future.  By avoiding some of the worst money mistakes you can make, you will be setting yourself above most, as I wish that I had followed earlier in life.

No Credit Card Discipline

Signing up for a free t-shirt promotion during my first semester of college started years of bad spending habits that would have been solved had I not had a credit card.  Sure having a card is good for your credit, as long as you make payments on time and pay off the balance each month, but in my case using it as an open spending account to have fun took years to pay off, teaching myself a lesson that I will eventually pass down to my children.

Not Contributing to 401(k)

When you graduate from college and start your career path the last thing you are thinking about is retirement, but pretty soon the years will catch up and you will realize you do not have much to show for it, so even if it is minimal, such as 3% or so, start contributing early.  If you are lucky to have your company match contributions, adjust for the max they will offer, as potentially thousands could be left on the table that you could have in your account.

Putting Off a Savings Account

The fact that the average American only has a couple thousand in the bank is no surprise as there is always something to spend money on, but you need to get in the habit of saving early on.   The more money that is left in your checking account is the more opportunity to spend on unnecessary items.  Use direct deposit to ensure that there are consistent contributions being made each paycheck.  There will always be big items to purchase, such as a home, car, wedding, so start young and you will thank yourself later in life.