So, in my last post, I had said that would be the last one of 2016. I think it would be selfish of me if I didn’t end off the year with something for you guys to take advantage of in the coming year. I have my own financial resolutions; some you already know, and some that are behind closed doors. Here are a few that all millennials should take part in if they are serious about their future wealth.
1. Pay Down Debts
You hear it time and time again, “pay off your credit!”. But do you really do it? If you are one of the millions of millennials who are buying things on credit while increasing their credit limit, stop yourself right now. I get asked all the time, “should I only pay the minimum for my credit card every month or should I pay it off as fast as possible in full?”. My answer to that is the same as it always has been! If you have an outstanding balance on your credit card, you better chain yourself to your job and get that paycheck all into your credit card or lock yourself in a room so you don’t spend that credit card! If you have debt, you can’t build! That is why there is NET worth – everything you own AFTER your debts are paid. Young adults are amongst the worst groups to give a credit card. Banks know this so they increase your credit limit so they can get their cut from the interest you pay but they make it harder for you to buy a home because they know you and others like you will bring on an economic crisis soon enough. The tradition of buying family members’ gifts using your credit card can no longer continue. Pay off that credit and stay off that credit. If as a mature adult, you know you cannot handle a credit card, take the mature step and cancel it. If you are a bad spender now with the $5,000 limit you get from your bank, you will not be any better with the $50,000 limit you get as an older individual.
Young adults are amongst the worst groups to give a credit card. Banks know this so they increase your credit limit so they can get their cut from the interest you pay but they make it harder for you to buy a home because they know you and others like you will bring on an economic crisis soon enough. The tradition of buying family members’ gifts using your credit card can no longer continue. Pay off that credit and stay off that credit. If as a mature adult, you know you cannot handle a credit card, take the mature step and cancel it. If you are a bad spender now with the $5,000 limit you get from your bank, you will not be any better with the $50,000 limit you get as an older individual.
2. Eliminate an Expense
Those $10 burritos from Chipotle can stay back in 2016 (Bill Ackman, you’re still my hero)! So can those killer cigarette packs you buy weekly. A hyuuuuge (Trump reference) chunk of our incomes goes to unnecessary expenses that are usually low in price but quickly eat up our money in a short periodic time. Look at your bank statements and determine what needs to go and what has to stay. Think about the 50-year-old you. Will he/she be pleased that you chose smoking cigarettes daily over you being able to retire wealthy as ever?
Make it a goal of yours to do this every year. If you are REALLY ambitious, go for two expenses. At the end of the day, it is about your future. You eat a skittle every day from a fresh pack and eventually, that full pack is empty. You eat away your money with short-term satisfactions, your bank account will be dry, and so will your rump when it is sitting on a sidewalk asking for change.
3. Create FOCUSED savings account(s)
We have been told all the time to start a savings account. And what happens months in? You take money out. Why? Because that savings account isn’t being saved for anything specific. You aren’t saving for a car, or a home, or investments; you’re just saving because that is what you have been told to do. Instead, decide what you want for yourself in 5-years, 10-years, even 30-years time. The wealthiest individuals do not plan for tomorrow, but rather years from now. It keeps you focused and tunnel-visioned, as well as immune to the volatility that life brings.
I recommend you to start thinking about saving to invest. SKILLFUL and PROPER investing will increase your net worth exponentially in the long-run. Don’t get caught up in the hoopla that you see online and from people you know. All that forex and binary foolishness are for the birds. They jump out the nest, fly for a moment and fall flat on their faces. Focus on building an income from your investments, not a quick high and fall. Save to invest not just in stocks, which I focus on, but real estate as well (which I will soon be starting). Which leads me to my last tip.
4. Educate Yourself on Personal Finance
In this day and age, there is no reason as to why you cannot find out anything anymore. The internet has a plethora of resources for you. Amazon has millions of books, Google has millions of results to any question you have. My recommendation is to pick up as many books on personal finance that you can. Start the year off more educated financially than you ever were. There have been thousands of individuals in different lifestyles who were once where you are now. Many of them have educated themselves and have been come wealthy, independent, happy, and free. They did this by applying themselves and taking the necessary steps to increase the quality of life the want for themselves. 50 Rules for 50 Fools aims to do just that – take you from one point in life to an entirely new point in your life. One that you never thought possible.
All in all, make this new year the best year you have ever had. The best results in life never came easily. Stay focused and think about your future, not just tomorrow. Steer away from the typical resolutions that get started then stopped after January. Think deeply about who you are and who you are capable of being and take the next step required to achieve it.
Until next time,
Live Long and Prosperous.
Get a plethora of tips to wealth!
Investing Millennial Jahnome McEwan provides FIFTY tips for Young Adults looking to build wealth from now. If working a 9-5 until retirement twists your stomach, Jahnome has a way to get you out of it!
Click here if you are interested in learning how!