Managing Finances for Millennials

Managing Finances for Millennials

For some millennials certainly finding the right way to manage finances is not an easy matter, especially for those of you who have never set personal money directly. Often the contents of the account suddenly thin out without knowing where it just went.

Such events can certainly be experienced by everyone and even financial advisers though you know. Like Mada Aryanugraha who now works as a financial planner and CEO of the SiPundi website portal that provides information and strategies to the public about the financial industry.

Millennials Are Spending A Lot

Middle-class millennials are arguably spending a lot of time in coffee shops, theaters, traveling, and even getting addicted to devices due to film or music applications.

Seeing this phenomenon, OneShildt financial planner Budi Raharjo said the lifestyle was very common among millennials. According to him, the average level of their early career income was higher and a better education.

“So that it has a higher disposable income [residual income beyond basic needs] compared to the previous generation,”

Not only that, he considered the millennial generation to experience a shift in financial priorities. They see that experience is far more important than asset ownership at a young age. Whereas the previous generation considered the millennial style to be consumptive.

Social Media Highly Influences The Millennial Lifestyle

The rapid flow of information on social media, he continued, is one of the factors that influence the millennial lifestyle. Not only that, according to him millennial also has a character that is far more daring to try new things. Moreover, millennial has many choices and offers of products and services for various lifestyles.

Even so, he said the reason for the lack of knowledge in good financial management from a young age, can influence the emergence of that lifestyle.

Ideally, Budi continued, lifestyle should also consider financial capacity first. “If the income is still UMP, then spending should be tertiary, such as lifestyle and traveling avoided. It would be better if the expenditure was only made if the income was more than 2 times the UMP, “he continued.

If you want a vacation, the allocation for recreation can be limited to a maximum of about 5-8% of income a year. Then to hang out and watch movies can be limited to around 1-2 times per month.

Final Note

There are many ways that millennials can start saving for the future. However, if faced with a car accident, there is always a way to get the money you need from your insurance claim like through car accident loans. But this doesn’t mean that money is easily accessible, millennials will have to learn to prioritize in order to put their finances on the right track.