Every millennial has his own fair share of financial regrets, which they do not want the Gen Zs to inherit. But as the oldest Gen Zs are starting to enter the workforce, they are also beginning to realize the harsh realities of earning money, which can easily put them into the same financial pitfall the millennials plunged themselves into.
But it’s not entirely the millennials’ fault why so many of them have gone broke. The oldest millennials weren’t spared from the effects of the Great Recession, making investments an unrealistic financial goal for them. And because a pandemic struck the world recently, the millennials who are already broke are struggling even more.
Likewise, the oldest Gen Zs also found themselves losing their jobs amid the pandemic. In fact, they may have it worse than millennials, because many Gen Zs aren’t eligible for stimulus checks yet if they are still dependent on someone else’s taxes.
Hence, their income opportunities are awfully limited in this period. But they won’t suffer their financial setback’s long-term effects if they adopt these clever money-saving hacks now:
1. Don’t make the same mistakes millennials did.
You could say that getting rich in your 30s is as simple as avoiding millennials’ money mistakes. But it is easier said than done. If the past generation still made mistakes despite being aware of its consequences, Gen Zs are also capable of doing the same, possibly even more so because they are younger.
According to a survey, the top financial mistakes millennials made are:
- Not saving enough (88%)
- Taking too much credit card debt (86%)
- Overestimating their expendable income (86%)
- Jeopardizing their credit score (84%)
- Not having a financial plan (81%)
- Spending their paycheck before the next payday (81%)
- Spending without realizing it (81%)
- Not saving for their retirement (77%)
- Splurging on big-ticket items (74%)
- Missing the chance to ask for a raise (73%)
Start saving as much as you can by opening a bank account. When your money isn’t in cash, you’d be less tempted to spend it. And when you’re saving more, you can ditch the credit card because you’d only buy things you can afford.
2. Set goals.
Set financial goals that you can align with your career goals. This may be a little tricky because when you’re young, you’re just unsure of what you want in life yet. You may develop a passion for photography one time, spend all your money on professional equipment, only to realize later on that it’s not what you want to do for the long-term.
The point is, don’t make rash decisions, even if it involves skill-building or your career. Try things out in baby steps, and prioritize your necessities when spending money. And if you’ve had a windfall, don’t exhaust it on your hobbies. Instead, try investing it on a useful asset, such as insurance, a small business, or a car if it won’t interfere with your money-saving goals.
3. Get uncomfortable.
As Robert Kiyosaki said in “Rich Dad, Poor Dad”, there are three investment values: to be rich, comfortable, and secure.
However, many people, regardless of the generation they’re born in, put security and comfort above getting rich. While this may work for most of you, as it’s undeniably easier to buy security and comfort before properties and other riches, sacrificing a bit of comfort now will reward you tenfold in the future. Such is proven by the wealthy, who endured discomfort for a time before they earned enough to make themselves more secure and ultimately rich.
Simply put, observe delayed gratification. Don’t excuse your impulsive spending by saying that you’d rather be happy than rich, because it’s not a choice between happiness and wealth. You can be broke but unhappy, or rich and happy, or vice-versa. At the end of the day, your happiness doesn’t entirely depend on your financial situation, so might as well give it your all in building your wealth.
4. Invest in yourself.
This doesn’t mean buying yourself designer clothes, bags, shoes, or expensive gadgets. Rather, it refers to honing your skills and talents, so you could make it a profitable side-hustle.
Establish yourself as a brand. Create online content, such as YouTube videos, photography, art, or makeup portfolio, etc. If you can afford it, align your current career with your passion so that you can focus on it, and develop as the type of professional you want to become. Find your niche, and create your brand around it.
Do this while you’re still young, and never give up, because it can make you rich by the time you reach your 30s. What’s more, investing in yourself will expand your network, granting you connections to many well-known personalities in your industry.
Notice how these hacks don’t contain intimidating things like buying bonds or trading stocks? While those will definitely help, these four hacks are already clever enough to make you reach your financial goals. In time, when saving has become second-nature to you, you’d naturally develop an interest in more complicated investment strategies.