Millennials and Money: 6 Financial Fears and How to Overcome Them

Millennials and Money: 6 Financial Fears and How to Overcome Them

Millennials—those born between 1981 and 1996—were raised in the boom of the Internet and began to enter the workforce at the height of an economic recession. It’s no surprise that they are best known for having different ideas on how to handle their finances.

They’re often shown living in the moment, overlooking any sort of preparation for the future. That is probably why 36% of millennials are found to have no savings at all, and only 38% of these young professionals feel financially stable. 

Not all is lost, however, as 44% of millennials have also been found to be prepared for a tight spot with savings that cover around three months’ worth of expenses. If you think your future financial woes could spell disaster, now is the perfect opportunity to find out how to overcome your fears and set yourself on the path to financial stability.

 

“It doesn’t seem like my current job will last forever.”

The problem: Job security can be difficult in the current economy, especially with the rise of automation and AI technology in the workforce across all kinds of businesses. You may also be working in an industry that has a high turnover rate or fewer chances for stability, making the risk of unemployment even more palpable.

How to conquer it: The way to beat this fear is to start an emergency fund to ensure that you have the money to maintain your current lifestyle while you’re in between jobs. The amount you need for your fund will depend on your job type, the stability of your income, and the state of the industry you work in. 

Ideally, it should cover at least three months’ worth of your salary and necessary expenses like food, utilities, commuting fare or gas, and personal essentials.

Another method is to take every opportunity to increase your work skills. Enrolling in online courses or participating in seminars can be a good addition to your resume, making you more valuable as an employee and increasing your chances for positions you may be applying for. 

“If I keep saving, I’ll never have enough to get what I want.”

The problem: It’s normal to spend your hard-earned cash on something that makes you happy, like the latest gadgets, a trip abroad, or even dinner with friends. However, it may become challenging to strike a balance between setting aside savings for a rainy day and allowing yourself to have fun every now and again.

How to conquer it: It’s possible to work and play without going overboard with one or the other through the 50/30/20 rule. The concept is simple: your income should be divided, putting 50% towards necessities like rent, bills, and the like, with 20% in furthering your financial goals like fodder for your savings or clearing debts, and 30% on spending on your wants. 

This rule can be a great start for managing your money, allowing you to settle obligations while treating yourself. Once you’ve developed this rule into a habit, you can adjust the percentages to suit your needs better. Additionally, splitting costs between your friends during group outings or looking for discount vouchers and sales such as Cashalo’s Shop Now, Pay Later can help you take the pressure off your wallet without having to deal with FOMO.

“A medical emergency will drain my savings.”

The problem: Car crashes, heart attacks, or even freak accidents, can be the stuff of nightmares, especially considering the hospital bills that will come with these. The fear is amplified if you’ve been involved in previous medical emergencies or if you have pre-existing illnesses that could escalate.

How to conquer it: Investing in health and life insurance can ease your medical-related worries. Make sure to shop for an insurance plan that has reasonable premiums while offering quality coverage. If a basic plan is inadequate, ask your insurance provider for a list of riders you can add to your policy to maximize your protection and minimize the risk of cutting into your savings.

“I want to buy a house, but I don’t think I have the money.”

The problem: Wanting a place of your own is an exciting venture—being able to live on your own terms sounds like a dream come true for many. Unfortunately, as rent prices and real estate values continue to rise, this dream may come at a cost steeper than you are prepared for.

How to conquer it: It’s better to find compromises that will make living independently more achievable while sticking to your budget. Consider sharing the living space with friends or a significant other. This will help bring down the cost for rent, utilities, and other dues. 

If living alone is more of a priority for you, focus your search on rent-to-own houses or condominiums, letting you achieve your goal at a more comfortable and realistic pace.

“I don’t have enough capital to start a business.”

The problem: You may have a great idea for a business that you want to see through, or maybe you want to take your career in a different direction by making your own start-up. Whatever the case may be, you may find yourself at an impasse. As the old saying goes, you need to spend money to make money. 

How to conquer it: You’ll need to plan carefully to fund your business. Set aside some of your money into savings or for investing and growing your business capital proactively. You can also consider finding business partners who can help shoulder some of the starting costs. 

If you need alternative sources of funding, there are financial institutions like Cashalo that can provide quick and easy loans in small amounts to help jumpstart your small business.

“I’m not sure if I’m saving enough for my kid’s education.”

The problem: As a Millennial parent, the biggest concern is preparing for your child’s future. Unfortunately, tuition fees and other related expenses can cost a lot. With bills and other necessary payments abound, you may be wondering if you have enough left over to give your kid the education they deserve.

How to conquer it: It may be time to create a dedicated bank account for your child’s future tuition fees and school expenses. This curbs your temptation to use the money for other expenses. You can also look into long-term investments like educational plans that mature after some years, right when your child is old enough to need these funds.

Wrapping it Up

Being a millennial doesn’t mean you have to live up to the stereotype of being unprepared and choosing to live in the moment. Being concerned about what the future holds for you and your funds should be your motivation to improve your money management and work towards overcoming these financial fears. 

It also helps to have a reliable partner like Cashalo in financial matters, with its various credit app services that deliver financial inclusion in the Philippines. 


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