Personal finance and budgeting tips for millennials

Millennials are the largest adult generation in the United States and make up 36% of the workforce, according to the U.S. Department of Labor. Born between 1981 and 1996, individuals in this age group often have a career that is well underway and are busy balancing work with personal and family responsibilities. During this stage of life, it’s important to set both short and long-term financial goals and develop a solid saving strategy for boosting financial freedom. Here are some helpful money management tips for millennials and where to seek valuable financial advice.

Setting and achieving financial goals in your 30s, 40s and beyond

As individuals enter their 30s and 40s, they often have several years of professional experience and a steady income. Some are also making the most of employee benefits, like contributing to a retirement savings plan. At this stage, some may be supporting a family, saving for a home, or focusing on building assets for the future. Setting financial goals is essential for prioritizing spending and turning long-term aspirations into achievable milestones.

What are financial priorities for millennials?

Financial goals can vary from person to person, but some millennials are looking to:

• Buy a house
• Lower or eliminate debt
• Create an emergency fund
• Build wealth and save for retirement

The importance of financial planning and goal setting for millennials

Before creating a financial strategy, it's important to determine which goals you wish to achieve in the short term, as well as those set for ten or more years into the future. This helps set guideposts to design a plan around and allows you to track progress along the way. Since goals can change over time, regularly reviewing the financial plan helps determine if it’s still aligned with your current situation, budget, and lifestyle or if changes need to be made.

Millennials and money management habits

Once financial goals are set, it's time to create a plan to help reach them. Adopting good money habits and using a budget to manage income and expenses is key to getting to the finish line. A budget helps with paying bills, reducing debt, and saving for the future. Start by calculating monthly income, followed by a list of expenses. If more money is going out than coming in, look for areas where you can make adjustments. Maybe you can cut back on non-essentials or pause certain expenses for several months to help balance things out. Good money management tips to consider include:

• Spend wisely and avoid impulse buys
• Set up automatic payments for bills
• Avoid accumulating credit card debt
• Move money into savings each month
• Find ways to boost financial knowledge

This life stage may also be a great time to diversify a financial portfolio and explore how to grow money with investments, the benefits of life insurance coverage, or ways an annuity could bring growth potential and steady income to a retirement strategy.

Strategies for millennials saving for retirement

While retirement may not be right around the corner, now may be the time to start building savings for the future. If an employer offers a retirement savings plan, this can be an easy way to put aside money every paycheck; plus, many companies will match an employee’s contributions. Setting up individual accounts like IRAs, 401(k)s, and SIMPLE IRAs are also options for building savings for retirement. When you’re ready to put a financial plan in place and understand which options are available, professional assistance can help make the process much easier to navigate.

Will millennials be able to retire?

A common concern some millennials face is whether they will be able to retire comfortably. With the uncertain future of programs like Social Security, it’s becoming increasingly important for this generation to take control of their retirement planning early. Starting to save for retirement as soon as possible allows millennials to take advantage of compound interest, growing their savings over time and to help them reach their desired retirement timeline.

Where can millennials get financial advice?

Financial advice can come from many sources, whether it's discussing money matters with family and friends or reading articles online or on social media. While these can be helpful for inspiration, connecting with a trusted financial professional who specializes in retirement planning and money management can be a smart choice. With a range of financial priorities to balance, it's important to have a strategy tailored to personal goals and long-term plans.

A financial professional can offer an outside perspective and expert guidance when reviewing your finances, addressing concerns, and exploring solutions that support achieving specific financial goals. By putting your financial health at the top of the list, you can be more successful at managing your day-to-day expenses and building the savings you need to feel financially empowered down the road.

The term financial professional is not intended to imply engagement in an advisory business in which compensation is not related to sales. Financial professionals that are insurance licensed will be paid a commission on the sale of an insurance product.

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