Millennials are a unique generation living in an era of digitalisation, convenience and accessibility. More millennials are going to college or university than in any generation before them, which also means that many enter the job market crippled by student loans. Consequently, this group faces a unique set of challenges and as such, the financial advice provided to the generations preceding them isn’t a good fit 100% of the time.
Here are 5 money-saving tips specifically tailored for millennials:
1. Living on your own is over-rated: get a roommate or move back home
There isn’t a college student who doesn’t dream of getting his or her own apartment, where they spend their college years living independently of mom and dad. It may sound glamorous, but the bliss of freedom only lasts until you run out of clean clothes. Living alone is expensive and the last thing you should be doing when saddled with student loans is racking up more debt. Be financially smart and get a roommate to split your living costs with (rent, utilities, food, etc.) or, if possible, move back home where board is cheaper or even free and your mom does your laundry.
Living at home might not be “fun” but – if it is an option for you - it is the smartest financial decision you can make and will enable you to pay off your student loans quicker, save money, and set yourself up for a financially stable life post graduation.
2. Opt for a low-interest credit card
The trick with credit cards isn’t necessarily to avoid them but rather to use them correctly. Using a credit card establishes your credit history and if you’re responsible with them, it helps you build a healthy credit rating. Many banks also offer rewards programs like eBucks and Greenback rewards, which is a great perk. Avoid spending the bank’s money by loading your credit card with your own cash before you go shopping. Also, make sure the credit card you’ve opted for is low interest and doesn’t have an exorbitant annual fee. The key words here are: free credit score services, % APR period, and no annual fee.
3. Learn to cook!
If your plan is to leave the nest and live on your own while you study or face the job market, then do yourself and your finances a favour and learn to cook. We’re not talking about going to culinary school – we’re talking about learning how to prepare 5 to 10 different meals, which you can eat for dinner and then use the leftovers for lunch or freeze for another time. A week’s worth of eating out, even at fast food restaurants, can easily cost a month’s worth of groceries. Do a bulk grocery shop, cook a large dinner, portion it out, and you’ll have six meals, if not more, which will save you a lot of money on food.
4. Focus on the little savings
Turn off the lights when you leave a room, be conservative with water, make coffee in a flask at home rather than buying expensive take-away coffee from coffee shops, take public transport rather than Uber, and with every buying decision you make, ensure that you’re saving money by choosing the less expensive route, option, product or service. For example, saving R5 on a 9-pack of toilet rolls might not seem like a big deal on its own, but if you’re saving an average of R5 on most of the items in your trolley every time you shop, it adds up. And if you apply this philosophy to every spending avenue, you’ll cut your expenses by a significant amount.
5. Don’t try and keep up with the Joneses
Modern society’s preoccupation with social media is a double-edged sword with one of the downfalls being that constant exposure to how “the other half” lives can be terribly depressing. Seeing your friends and favourite social media influencers eating at nice restaurants, buying expensive cosmetics, shopping at trendy clothing stores, travelling to exotic destinations, and generally living the good life can compel many to live beyond their means. Just remember: people only show you what they want you to see on social media and while their lives might appear glamorous, the reality could be a very different story. Stop comparing yourself to others, put your needs first, concentrate on your own life, and be proud of your thriftiness.