Stop Your Money From Stressing You Out.
Listen, the numbers don't lie. 76% of Americans are living paycheck to paycheck and 90% of Americans buy things they can't afford. Financial expert, Dave Ramsey, says if you can't buy two of them then you're buying something you cannot truly afford.
Millennials have cited that their finances are one of their biggest stressors. Granted, issues like high student loan payments and underemployment are factors in most millennials’ finances, but there are other concerns like lack of a savings plan or budget to consider. In a recent study by Fidelity Investments, millennials (those aged between 25 and 35) generally described themselves as spenders versus savers or investors.
So why is it that we continue to spend knowing that our finances continue to stress us?
Spending and then getting frustrated by your finances is an emotionally abusive cycle that we’ve got to stop if we plan on becoming a wealthy generation instead of one that has to rely on parents to cover some our bills (47%) or live at home with parents because of financial reasons (21%).
According to Fidelity Investment’s study, the biggest issues millennials are tackling include accumulating more savings (44%), building an emergency fund (44%), paying for essential living expenses (38%), reducing credit card debt (33%), and paying off student loans (30%).
What was even more troublesome is that while many millennials are spenders, 40% worry about their future financial security with a quarter worrying all the time.
Learn to say no when it comes to purchases.
Saying “no” first requires discipline and discipline comes with practice. Your mindset about the things you think you absolutely need will have to change. No one needs to get their nails done every 2 weeks (maybe just once a month). No one needs to eat out at the nicest restaurant and bar that opened a week ago (try cooking at home and then having one drink with a friend). No one needs the “cheap” midi dress set (it’ll be ruined after a few washes anyway). Save up your money for a nice piece of versatile clothing (cashmere, anyone?).
Here are other ways to say “no” and offer alternatives on millennials’ biggest spends:
- Eating out: either say “no,” eat out less a week, or suggest cheaper places. Millennials spend roughly $3,000 eating out each year. Even if you only ate out a third of what you currently do and save the extra money, you could have $2,000 saved in one year.
- New shoes or clothes: although nicer pieces are initially more expensive, in the long run, they’ll cost you less when you consider how long they’ll last compared to “fast fashion” pieces like H&M and Forever21.
- Entertainment: Groupon, LivingSocial, and group deals should be your number one resources for entertainment. It may not be that convenient but shopping around for the best deals is worth how much you’ll end up saving in the long run. Another option is to do fun activities in the privacy of your own home with close friends.
How will you reduce your stress from your finances?