Financial Advice from Gen X to Millennials

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Financial Advice from Gen X to Millennials

Mikey Rox for

We Millennials think we know everything about everything (at least according to the rest of the world anyway), but there are still a few things we can siphon from those who came before us—especially when it comes to money. Because while we’re statistically savvier in our spending and saving habits than older generations—particularly Gen X—that doesn’t mean we’ve got it all figured out. In fact, we can even learn a thing or two from the trial-and-error of our aunts’ and uncles’ generation.

Work the System as Long as You Can

Studies show that Millennials are living at home with their parents longer than previous generations, and it’s not hard to see why: For the past decade or so, the American economy has been iffy at best, and in the last five years, most Americans have struggled to find their financial footing. It only makes sense, then, to live at home with mom and dad for low- or no-fee rent for as long as you can—if they’ll have you.

As someone who’s on the upper cusp of the Millennial spectrum—I was born in 1981—I feel like I have a good handle on issues that affect both Gen Xers and Millennials. That’s probably why I don’t have a problem with my generation forgoing independence a little longer and living at home so they can stash enough cash to start their life comfortably when they’re ready. Some Gen Xers may balk at that idea—“Stop mooching,” they scream—but are those cries really about manning up and joining the independent society, or are they rooted in jealousy that they themselves didn’t take advantage of that opportunity when they had it?

Really, though, who cares? If you can work the system long enough so that you’re not living paycheck to paycheck if you don’t have to, good on you. Just one more reason you’re wiser beyond your years than the people throwing shade.

Minimizing Spending Can Be as Profitable as Investing

I’m a big advocate of investing your savings in potentially profitable efforts, as opposed to letting it sit in your savings account to accrue interest at a snail’s pace. You’re not going to make any money focusing on the latter. That’s not to say, however, that you should start throwing every extra dime you have at investment opportunities—you still need to build your emergency and retirement funds, which ideally are separate entities altogether—but, in general, building an investment portfolio also should be on your radar.

You may also want to start thinking differently about investments. Namely, not just about putting money that you’ve saved toward a particular endeavor or opportunity, but rather curbing your spending entirely to make and take more money that you can invest, which, incidentally, also is a lower-risk proposition when compared to the former.

“A low spending rate offers a better return on effort than most investments do and they're much less volatile than the markets,” says Josh Maher, a successful angel investor and author of Startup Wealth: How the Best Angel Investors Make Money in Startups. “Millennials should invest in a broad market index with low fees at a minimum, but saving 20, 30, or 40 percent of earnings is going to prove to be an incredible foundation to keep them confident in both good and bad times.”

Treat Your Home Like a Financial Asset, Not Just a Place to Live

I started dabbling in real estate with my husband a few years ago, beginning with our first home that we purchased together, a condo in New York City. As a result of the sharing economy—namely short-term rental sites like Airbnb that allowed me to rent out our guest bedroom for income—we were able to save enough money to purchase a second home on the Jersey Shore. In turn, we also reside in this second home part time and rent it out on a short-term basis to vacationers mostly during the summer, the income from which will be put toward the purchase of a third home, which will exist strictly as an income property in the near future.

The point of this is that, even our first home, we were able to turn into a profit center, which was the goal before we even purchased it, and I advise everyone to think of their own homes in these terms as well. You’ll need to put money in to get money out, of course, and maintenance (and the cash flow to afford it) is key.

“Your primary home is such a large part of your financial picture, in terms of ongoing expenses, but also in building wealth and being able to sell it in the future,” says John Bodrozic, co-founder of Homezada, a service that helps homeowners digitally manage their homes.

Your homes aren't just dwellings; they’re your future—and you need to treat them as such.

Start Saving For Retirement Right Now

You want to give yourself the best opportunity to live the life you’ve always dreamt of, but that’s not limited to your younger years. More so perhaps, you want to be comfortable in your advanced years so you can kick back, relax, and reap the benefits of putting in 40-plus years of working to build your lot in life. Certainly there are myriad factors that contribute to your quality of life once you retirement, the most important of which, however, is your retirement fund—and you need to start it right now.

“If your retirement investments are small or nonexistent, you may feel like giving up, but don't,” says Shay Olivarria, a financial education speaker and author. “The beauty of compound interest is that with time even a little bit of money can grow into something substantial. [As little as] $150 per month—that's only $75 per pay check—can grow into $226,137.84 over 30 years.”

Take All the Free Money and Resources You Can Get

Not much in life is free, and that’s usually true, but some employers offer contribution matching to retirement plans like 401ks and 403Bs. It stands to reason that if you’re not taking advantage of it, you’re losing out on a windfall of free money. Stretch that out over the course of a 30-year career and the choice is a no-brainer. Check with your HR department to find out what your retirement programs look like, so you can get on board ASAP.

Olivarria also suggests looking into other free resources your employer may offer outside of matching contribution, like access to financial experts.

“If you're not sure where to begin, ask if your company has an Employee Assistance Program (EAP),” she advises. Many EAPs will provide employees with access to free financial experts and via phone. It's completely confidential so you don't have to worry about anything getting back to your office. They will also refer you to a certified financial planner in your area if you'd like more assistance.”

Set Shorter-Term Goals to Enjoy the Benefits of Savings

You should absolutely be saving for your future and your retirement—that should be your main financial focus (outside of investing)—but don’t forget to live a little, too. Enjoy a fraction of the fruits of your labor every now and then by setting short-term savings goals that are allotted for something fun. You only live once, after all.

“Everyone tells you to start saving early, which is great advice, but I also think it's worth making a list of mid-size ticket items you want to buy over time - maybe it's a guitar or big trip or whatever you're into - and put a little aside each month,” says Heather Lovett, PR director for DealNews. “Saving for retirement is important, but it's also good to set a shorter-term goal so you can enjoy the benefits of saving.”

Stop Trying to Impress Others

Mo’ money, mo’ problems, as they say—and Millennials aren’t exempt.

The conflict that arises when you start earning more income is that you start spending more, but you’ve got to be careful. If you’re spending more money on investments, that’s all right—if you’re thinking through the decisions carefully to chose the route with the best potential ROI—but if you’re bleeding cash on thrills and frills just so you can look like a baller, you could encounter a heap of avoidable problems down the road. Stay the course, and you’ll be rewarded handsomely.

Take Danny Kofke, for example. The 40-year-old personal finance advisor and author in Georgia may not have lived a glamorous life, but he’s set himself up nicely for the long haul, and that’s all that will matter in the end.

“My wife, Tracy, was a stay-at-home mom for nine years to raise our two daughters Ava and Ella before getting back into the classroom in 2013,” he explains. “Despite living off my $42,000 a year teacher's salary, we have no debt except our mortgage, we invest each month, and we’re on track to retire as millionaires and have a one-year emergency fund in place. The best advice I could give is to always do what is best for you and your family and not try to impress others. While easier said than done, it has served us so well.”

Are you a Gen Xer? Do you have financial advice for Millennials? Let me know in the comments below.

The information contained is intended to be for informational purposes only and should not be relied upon for investment, accounting, legal or tax advice.

Mikey Rox is an award-winning journalist and personal finance expert dedicated to helping you live your best life on a budget. His work has been published by more than 100 media outlets worldwide, including Wise Bread, Business Insider, Time magazine, The Huffington Post,, and MSN Money, among many others. Mikey spends his time between his homes in Manhattan and the Jersey Shore with his dog Jaxon.

Find Mikey online at Facebook, LinkedIn, and Twitter.

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