Whether it’s a medical emergency, layoffs or a car repair, having an emergency fund will help you deal with these unexpected financial burdens without going into debt.” Budget for Family Planning
#Millennial money moves full
“Life is full of unexpected expenses, and you must be prepared for them. “Start building your emergency fund as soon as possible,” Rupp added. Rupp recommends putting aside $2,000 for spending shocks and 3-6 months’ worth of expenses for income shocks. “Millennials should focus on building their emergency funds, which should be able to cover the potential stressful and costly financial surprises life throws your way,” said Cassandra Rupp, senior financial advisor at Vanguard. There’s no time like the present to build an emergency fund and anticipate life’s many curveballs. “Of course, life insurance is customized to individual needs but, whether you have kids or not, getting underwritten in good health, getting cheap coverage and having an option to convert to a whole life is the best of both worlds.” Build an Emergency Fund There are several misconceptions millennials have around life insurance, such as cost and eligibility, but “generally young, healthy adults are most likely to not only qualify for coverage but also to be able to secure the most affordable rates,” according to the LIMRA study. That puts their loved ones at risk of financial hardship should something happen to them. While a good chunk of that generation have dependent children, own homes and have more than $100,000 in household income, 55% have no life insurance coverage at all, according to the Life Insurance Marketing and Research Association’s 2022 Insurance Barometer Study. Once you have your debt paid off, you can save and invest.” Life InsuranceĪnother step millennials should consider is taking life insurance. Focus on paying off your credit cards and consumer debt first. Lock your credit cards now and stop taking out new debt. “It is possible to live a debt-free life. “With interest rates on the rise and credit card interest rates about 20%, the cost of debt is stealing from their future,” said Jay Zigmont, Ph.D., CFP, founder of Childfree Wealth. In turn, many experts agree that the smartest move a millennial can make is to get out of debt and stay out. This represents not only the largest jump of any age group, but it’s also the fastest pace of debt accumulation over a three-year period since the 2008 financial crisis, The Wall Street Journal reported. Total balances were more than $3.8 trillion in the fourth quarter of 2022 - a 27% increase from late 2019, according to the Wall Street Journal, citing Federal Reserve Bank of New York data. Millennials are accumulating debt at a record pace. Yet, the generation also has specific financial moves they can make to ease their financial stress and plan for their future.
#Millennial money moves how to
Learn: How To Build a Financial Plan From Zero See: How Many Americans Have $100,000 Saved for Retirement? Some of them already have been through a recession, and now persistent inflation, student debt and soaring rates are challenges that are adding to the lingering economic toll the pandemic took on their wallets.
Millennials are facing a specific set of financial challenges.
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