Here are useful tips for millennials interested in acquiring knowledge on how to manage your finances.
Only few millennials have basic knowledge concerning money and finance.
Majority of young people want to live life on the fast lane, fast money, fast cars, expensive things with the larger than life status, the YOLO (You Only Live Once) lifestyle, but as we all want to attain this level, learning about managing funds and personal finance is very important
1. Wealth and income are different
Income is the amount made on a regular basis while wealth is what has been acquired over a long period of time. You might make 6 figures a month and still not be wealthy; people might assume you are rich because of the lavish and ostentatious lifestyle. While someone might earn less and be wealthy because of good savings habit and smart decisions made.
2. Value of Time
In the finance and money world, time is money. This means that if time is lost, money is also being lost and can never be regained. Time is never enough but if managed properly, a lot can be achieved. Before going to bed at night, plan your schedule for the next day, wake up an hour early to prepare for the day. Also during the idle or free time, Millennial should get busy and making the best use of every time.
3. Scale of preference
A scale of preference is the ordering of various needs in order of importance, ranging from the most urgent need to the least important need. Priorities should be set straight. Also when preparing a scale of preference, it must be noted that needs should always be separated from wants
4. Risk Tolerance
Know the kind of risks you can take, building finance around how much risk you can handle.
5. Side Hustles
Having a side hustle gives financial freedom. Everyone wants an extra source of income, not having to depend on the salary from the 9-5 office job. Most side hustles are brought to reality or created out of the passion and love of an individual for a particular thing.
6. Long-term goals
Lots of millennials want what they want quick and immediate which means very few people work towards long term-goals. There is a great advantage having long-term goals, taking the opportunity of time arbitrage which has favourable returns than short-term goals.