6 Things Young Millennials Should Know About Managing Finances

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When I was in my early 20's, still trying to figure out how to spend my very first salary, I was overwhelmed and ecstatic. It led me to my 5 biggest money mistakes.

A lot of studies shown that a young individual is not responsible enough on handling their finances. Millennials have been labeled YOLO (You Only Live Once) and tend to spend all their money that is not well planned. There is this fear of missing out from the trend and peer pressure from what they see on social media.

Filipino millennials are known to be the most productive when it comes to work so they have the most generated income but don't have any savings at all. Here are the 6 things that young millennials should know about managing finances.

Saving and investing early is more feasible

Time is your greatest asset when it comes to saving. It is never a great idea to delay saving now. The earlier the better because of the compound interest that do wonders to your saved money.

Build your budgeting habits

For a better spending habit, always track your spending. This way you'll be able to know where to cut down your expenses. It will help you control on where your hard earned money is going and will let you save for your financial goals.

Start your Emergency Fund Now!

Why do you need an emergency fund? It is recommended to save at least 3 months’ worth of your salary for the unexpected expenses like job loss, medical, car repairs etc. Set aside at least 20% of your salary.

Skip the credit cards

In a way to get that gadget upgrade and money quickly, young millennials tends to dive into getting loans. Having a credit card will make you spend more even if it’s not needed.

Smartphones are not investments

It is not necessarily smart to invest on gadgets that rapidly changes every time. You'll be on a trend today but will never be in the long run. Invest on pieces that you will be using for years.

Financial Literacy is the key to financial freedom

Millennials are so lucky nowadays because they all have the resources online. It is not an excuse now not to have savings just because you don't know how to start or when to start. There are a lot of resources out there to know more about financial literacy. It is also a great help to join forums, attend discussions and even financial seminars.

Just recently, I have the privileged to attend the webisode taping on FinLit where BDO Foundation makes an effort to have the government involved in its advocacy on Financial Literacy.

Discussions like this is a great way to push young millennials on learning more about money matters that will help them achieve financial independence.

Stay tuned on BDO YouTube Channel for the forthcoming launch of these series of webisodes on Financial Literacy by BDO as part of its efforts to support the financial inclusion advocacy of BSP.

Being young and carefree is not at all a hindrance when it comes to managing finances. “A good financial plan is a road map that shows us exactly how the choices we make today will affect our future.” – Alexa Von Tobel