Hi, In this video, we will be discussing tips which can help millennials improve their finances.

Hi, In this video, we will be discussing tips which can help millennials improve their finances. If you were born between the early 1880s and the late 1990s, you are a millennial. Money management for millennials is quite different from other generations. Unlike our parents, our focus of money management has shifted from securing our future to “living in the now”. With new inventions like buy-now-pay-later mania and credit on-the-go, many of us end up choosing a life of luxury over financial security.

Also, with higher costs of living and stagnant salaries, we often find ourselves living pay check-to-check with no savings for our future. With the simple tips which we are about to discuss, you will be able to transform this behavior and improve your financial health.

First tip is to control your credit card debt. Credit cards are an easy way to buy things, but they also charge very high interest rates on their unpaid balances. This interest is an unnecessary expense and you can cut it down by avoiding using your credit card except for emergencies; and paying off your entire unpaid balance before the payment cycle ends.

The next tip is to avoid impulsive shopping. A lot of us often tend to purchase things without planning for them. Such impulsive shopping can lead to excessive shopping and it can even put us in a debt trap. To avoid this, whenever you go out to shop, make a list of the things you need and stick to it. Making a shopping list is the best way to ensure that you don’t shop excessively.

Next, is to build an Emergency Fund. This fund is a sum of money that you set aside for your financial emergencies like hospital bills, unemployment, etc. It is optimal if you save at least 3 to 4 months of your total income in a separate fund. Do remember to keep this fund in a separate account so that you use it only for your emergencies.

Lastly, while we track our salaries and incomes, it is equally important to track our monthly or day to day expenses. These help us in understanding where are we spending more, which can be curtailed. If you find it a hassle to record your expenses manually, you can choose to use multiple apps and tools available on the internet to track the same. These apps can track your expenses on-the-go, and you can even set alerts when your expenses have exceeded a certain limit.

Final tip is to build the habit of investing. The equity segment is the only place where you can grow your wealth at a rate that’s higher than inflation. No matter how small the amount, make it a habit to invest regularly. You can choose to invest by – setting up a systematic investment plan, or buying some company shares and accumulating them regularly. Small steps like these can make big positive changes in our lives, and help us accumulate the savings we need.