Millennials approach life very differently than generations before them. And while that’s true of every young, up-and-coming generation, finance tips for millennials have changed dramatically compared to only a few years ago because of how they want to live their lives. Sometimes they get a bad rap, but new ways of solving problems are always a good thing.
Prioritize Your Life
Saving for retirement is not the goal for many millennials. It’s way off in the future, pensions are a pipe dream of the past, and there’s disillusionment in the air about what will be waiting after 50 or 60 years of hard work. Millennials want to enjoy life now, and they like the good life. But that doesn’t mean they’re financially irresponsible. You need money to accomplish these goals, and millennials are finding alternative ways to fund a lifestyle of fun and travel.
Create Passive Income
The idea of your money making money or earning money without much effort isn’t new. That’s why investing in the stock market or real estate has always had appeal. But the reality for most people is that they pick up extra work or side hustles when they need cash. That helps, but you’re limited by your time and skills. Millennials are finding new ways to create passive income streams.
What is House Hacking?
Have you ever heard of house hacking? It’s a scenario where you own a house, but you live with roommates, and their rent covers the mortgage and bills in full. You live rent-free and have what you would be spending on that available to fund your lifestyle. Even though millennials are young, it’s possible with different grants and programs to purchase a home for less than 20 percent down. Or, you can start in a more affordable area, with the goal of selling and trading up or acquiring multiple properties as cash flow-generating investments.
Passive Income Becomes an Investment
House hacking is a strategy that can help you deal with skyrocketing rents and get you into real estate as an owner. Best of all, it lets you keep a lot more of your monthly paycheck since your roommates are paying for your investment. This can add up to as much as 30 percent of your monthly take-home pay, which can go a long way toward seeing the world, paying off your college loans, or starting your own business.
With this new twist on earning money without punching the clock, these finance tips for millennials are a little different than for past generations. They’re going to generate cash in traditional ways when they need to, but expect other creative ideas to change the game as millennials continue to tackle the financial challenges that come their way.