Money management can be hard to understand and implement correctly for so many of us. Trying to keep track of all your spending, staying on top of bills, going out and enjoying life, and building savings all at once can feel almost impossible. So, if you’re looking to secure a mortgage or take out a car loan soon, it’s time to start saving, and saving right.
There are many sources online that can help you understand your finances better, and pages upon pages of financial advice and ways to increase capital. However, the sheer amount of information out there can feel overwhelming. Luckily, we’ve scoured financial advice pages and done the reading for you, to make it easier to take in the important information!
What money problems are Gen Zs facing?
Before giving out any kind of advice, we first need to look at the financial problems that Gen Zs say plague their bank accounts. As we enter adulthood, we are faced with new financial challenges, stress caused by these challenges, and becoming financially independent. The pressure of becoming financially independent isn’t just causing economic insecurity, but real emotional distress. Plus, it’s something that remains top of mind when thousands of people online everyday show off their wealth on social media. According to recent surveys, Gen Zs noted a number of unique financial challenges that come with independence, such as:
· Going to and paying for university
· Starting a career
· Understanding and creating a reasonable budget
· Having an emergency fund
In a recent article published by the Australian Securities & Investments Commission (ASIC), approximately 68% of Gen Zs find finances as a ‘major cause of concern’. The rise of cost of living is a major factor in this sense of unease, however, it seems that 82% of Gen Zs aged between 18-26 are ‘twice as likely as any other generation to want to better manage their finances’.
So now that we know the problem, let’s get into some solutions.
Start saving early
The best thing to do to feel more financially stable is to open up a savings account and to start saving now. It doesn’t matter where you work, or how much you earn, you should be putting some money aside for unexpected expenses and future large purchases.
It also doesn’t really matter how much you put aside; could be 5% of your paycheck or 20% – every little bit helps. Just be sure to choose a savings account that offers exceptional interest rates and other features that are best suited to your needs and income, and portion your money in a way that allows you to start saving as soon as you start working. Remember, the earlier you start, the more you’ll have, and the quicker your savings will grow!
Make sacrifices now so you don’t have to later
Making financially-conscious choices and sacrifices is a tough thing to do for consumers in all age brackets, whether you’re a Gen Z-er or even a millennial. Keeping your spending in check can feel like you’re sucking the fun out of life, but your future self will thank you for it.
We’re not saying don’t have any fun at all, but cutting back on going out, eating in more often, and buying less expensive items when cheaper ones perform the same can dramatically impact your financial security. Consider creating a plan that allows you to do what you want, without completely wiping your paycheck every fortnight, and stick to it!
Create realistic financial goals
The best way to stay on track is to have a plan or goal. It’s much easier to get somewhere if you know where you’re going. Your bank account should be equipped with alerts and reminders, along with a goal setting feature to help you stay on track. We recommend taking advantage of these features to help you remember to save, and to keep your financial position on your mind as much as possible, to allow you to save without really thinking about it. Figure out your specific financial goals based on your income, make a plan, and watch your savings grow.
Choose function over form
When it comes to purchasing household items, clothing, and even a car, it’s important to look for usability and longevity over looks. Brand names are just that, names. Buying an item based solely on what it represents rather than how well it’s made is a financial trap. That’s not to say that you should never splurge and get something you really like regardless of its quality, but this should heavily depend on your financial position. When choosing clothing, you can always find items that look good and are made well, despite not being associated with a big-name brand. When buying a car, choose one that is economical to run and fix, and mitigate future unexpected costs, rather than going for an option that you like more, but can turn into a money pit. Research is everything, the more of it you do, the more ways you can find to save money and cut unnecessary costs.
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We hope these tips help you feel more secure and informed on the steps to take to become more financially stable. Remember, not everyone can reach their financial goals fast, but that shouldn’t matter. It’s easy to compare yourself to others, especially if you share the same goals and interests, but don’t allow that to affect your perception of yourself. Stay the course and you’ll achieve your goals before you know it!
