Millennial Financial Planning

The millennial generation (those born between 1981 and 1997) is thought to be impulsive, unfocused and entitled. As millennials enter the workforce and begin to experience the responsibilities that come with independent living and a salary, they don’t always prioritise financial stability — focusing instead on work/life balance and fulfilling their dreams. While it isn’t necessarily a bad strategy to pursue your passions, there are certain practices one should consider to that will help make things easier in the future.

There is never a bad time to outline a budget to help you prepare for the future. To start creating a financial plan for yourself follow these tips!

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When you enter the workforce for the first time, you’ll gain access to many financial benefits that you may not have been accustomed to. Regular paycheques, retirement income savings and other benefits may be new to you. The biggest difference will be your salary. It’s important that you know your take-home salary (not the amount you earn, but the amount you actually get paid out after taxation). Once you have that figure, follow these steps to create a budget:

Choose a budgeting plan that fits your lifestyle.

There are many options out there like online budgeting calculators, budgeting templates or even budgeting apps. Pick the one you’re most comfortable using and that feels the least like a chore — it will increase the likelihood you’ll continue using it.

Establish where your funds will go.

A budget is a framework to help you understand where your paycheque should go. A basic way to approach your budget is the 50/30/20 rule. This minimalist rule is great for most budgets and helps you know where your salary should be allocated: 50% to needs, 30% to spending and wants and 20% to savings and debt.

Set up alerts to keep yourself accountable.

There are great apps available like Mint or Clarity that automatically categorise your transactions and notify you if you’re spending too much in a certain category. You can also keep track of this manually in a budgeting template.

Reflect on your budget monthly.

When you reach the end of the month, take a look at your spending: were you over or under budget? If you were over, look into your spending trends by category. See where you went over and opportunities for cutting back. If you were under budget, great job! Take that extra money and put it away into savings. While you may be tempted to spend it, that extra cushion could be useful if unexpected expenses come up in later months. It may not seem like much now, but what you save will add up over time and may keep you from going over budget.

Over 33% of millennials regret going to university because of the resulting debts.1


Minimising your debt is the first step to getting ahead. The process is not always easy, especially when it’s a substantial amount. However, there are some small steps you can take now to make a big difference later on.

Collect all the relevant paperwork you need to evaluate your debt.

Some of this may be online records or tangible records — the important part is to look at the big picture of your debt as a whole.

Prioritise your debt payoff.

Organise your debt by highest interest rate — even if it’s the smallest balance, you should pay it off first while making minimum payments on your lower interest rate accounts. This will help you minimise how much you end up paying in interest over time.

Seek out lower interest rates.

It’s possible to lower your interest rate, which could help expedite your payoff process. Not all lenders are willing to negotiate, but it doesn’t hurt to ask, especially if you’ve never had a late payment or have been a customer for a long time. You could also transfer your debt to a card with zero-interest. Before you do, make sure you inquire with both lenders to see if there are any fees for transferring balances and, if so, how much — sometimes the fee to transfer is more than what you would save by switching.

Stay consistent.

The biggest challenge is not to give up. Debt payment is tedious and can be frustrating — focus on the end goal and how great it will be when the debt is all gone. Be mindful not to put more debt on the cards you’re paying off and prolonging the cycle.

One in three millennials feel like their generation has been priced out of the property market.1

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Once you’re in a good place and really bulking up your savings, it’s time to think about investing some of it. While many of us think to purchase a house, there are many other ways to diversify your savings. If you’re inexperienced with investing, look into robo-advisors. Based on personal goals and preference of risk, these online investors use an algorithm to make smart investments on your behalf. Millennials gravitate to options such as these because they are less costly than dealing with a person, and they eliminate the personal bias of a human advisor.

There are many ways you can start planning for your future. Find which one suits you best and get moving toward your financial goals.


1Aviva. (10 August 2016). UK: Generation regret: over a third of millennials who went to university regret doing so as they struggle with debts and squeezed finances. Retrieved 7 February 2017, from

The information in this article is provided for education and informational purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness or fitness for any particular purpose. The information in this article is not intended to be and does no constitute financial or any other advice. The information in this article is general in nature and is not specific to you the user or anyone else.


Babs is a content writer at Enova International, Inc. with a Bachelors in Cinema Studies and English from the University of Illinois (ILL-INI!). She loves binge watching musicals, reading in the (sporadic) Chicago sunshine and discovering great new places to eat. Accio, tacos! Find out more about her on Google+.


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