Hey there fellow millennial! If you are anything like me you are probably debating between starting to budget or doing what your friends are doing, nothing. You may have noticed how unorganized and unhappy their lives are and thought to yourself, hey, that’s just life. But it really doesn’t have to be that way! Budgeting is the key to happiness. Whether you’re a millennial who is a couple years into your career, a recent high school or college graduate, or just starting out, you need a budget. Living a life without budget is living a life without happiness! Just remember, being frugal is the way to go! Here is the ultimate guide to budgeting for the millennials and also some things you can invest in for your future, let’s get started!
First of all, what does it mean to budget?
Basically, a budget is a process of creating a plan to spend your money. The spending plan is called a budget. Creating a budget will allow you to organize your bills and pretty much your life! Don’t lie to yourself, does your life feel chaotic? Do you think your money is randomly going missing? Do you worry about what the future holds for you? Are you wondering where your money goes because when you want to use it, it isn’t there? If you said yes to any of these questions you need a budget. You really need a budget either way. You would be surprised how easy it is to take off the coat of worry and stress when everything is on paper!
So how can I get started?
The first thing you need to do is look at the big picture. At times you will feel like a chained up dog because you are monitoring your spending but don’t think of it like that, think of the happiness you will have every day waking up when you know you’re not late on a bill, short on a bill, or didn’t pay the bill at all because you forgot! The big picture is the happiness you will feel when you follow your budget plan and don’t lose sight of that big picture even for a second! Here are three ways to get on the path of happiness!
- Create a budget– Winner, winner, chicken dinner! You probably already knew this part was going to happen and if so give yourself a pat on the back and let’s move on. A budget will allow you to live comfortably within your means with enough leftover to save for your long-term goals. Yes, I just said left-over money, because that trip to Paris isn’t free and you deserve to live your life! The payoff is worth the wait, I mean hello, leftover money!
So how can you create this magical budget filled with happiness? You need to write down your monthly expenses. This list should include your rent, utilities you pay for, your car insurance and payment if you have one, and of course the food you spend on. You should also add on anything you pay monthly on like a gym membership or Netflix subscription. Don’t forget to add on how much you spend on eating out or other entertainment. This budget list should ensure that no expenses are left out.
The next thing you need to do is subtract your expenses from your income just to get a picture of what you have to work with every month. This way you can set your own set of goals and decide how you want to spend your extra money whether it’s in savings (which of course, I recommend to do) or for your trip to Paris. You can also determine whether or not you need to cut down on some things like eating out or your shopping budget with the results of your budget sheet.
- Get some help!– Don’t be afraid to get some help from technology. Technology is our best friend and it’s time to use it to our advantage! Making your budget easy and convenient will make it more appealing for you to continue budgeting. Making a budget that is difficult to understand or to edit will be the straw on the camel’s back and will have you back to the way you were before you were budgeting. It’s okay, we’re only humans, we give up easily but don’t let that limit yourself and push through, it will pay off later! Consider working with free apps that you can easily download on your phone. Seeing your budget plan and having reminders on your phone will let you see your path easier and will more likely keep you on that path by seeing it every day. I know you use that Facebook and Instagram religiously so take a couple of minutes and download one of these apps to help your budgeting be as easy as possible.
- Mint: This app can be downloaded with any phone and is my bestie. I personally love this app because for one it’s free and for two it’s safe. One downfall of this app is that it isn’t easy to put together at first but once you push the boulder over the hill the first time you will find it rolling down the hill easily without that push anymore!
- Level Money- If you are craving simplicity then you will fall in love with this app. It’s obviously available with all phones and is very free and easy. Free and easy, why can’t everything be like this? This app is super cool because it will allow you to separate your expense categories and let’s you know how much available cash you have for the day, the week, and the entire month. Can’t get any easier than this app!
- LearnVest– This app is not the best app for putting your budget plan into but the helpful thing about this app is that your account links with this app and files your purchases into category folders. Not only will your expenses feel organized but there is a ton of financing tips and articles you can read with this app.
- Stick with your budget my friend– It is so easy to fall off the wagon but you can’t quit your budget! If you quit your budget it will be worthless but don’t worry there are two of my favorite ways you can keep this good habit up! The first thing you can do is write out your financial goals like buying a new car, saving for your first house, or saving for your trip to Paris somewhere you can see daily and never forget your goals and what you’re working hard for. I put my list of goals in my bathroom wall by my sink, this way I can read my goals as I brush my teeth every day. Keeping your goals somewhere you can always read them will be the biggest motivation you can give yourself. Another thing you can do is add your goals and budget list on your phone, I would even post a photo of the Eiffel tower as your screen saver so you don’t lose sight of your ultimate goal. Visiting your budget plan daily on your phone just like you would upload a photo on Instagram or Snapchat what you’re eating, take a minute a day and read over your budget to make sure you are on the right path.
What you should invest into while you’re young
One of the best things about being young is that most of your insurance premiums will be low (of course excluding your car insurance) like your health and life insurance premiums. One of the biggest investments you can do is invest into a great health care policy as well as a life insurance policy. You will never be this young and healthy again and getting a policy for both insurance types will mean you are going to get the cheapest rates around. Having a good health insurance plan is important because you don’t want to get stuck paying your hospital bills, or doctor visits. Most people don’t talk about life insurance and the most common reason to why they don’t is because no one likes the conversation of death. That’s probably the last thing you are thinking about too but don’t be silly and think you are young and you don’t need it. The thing about life insurance is that you really might not need it this second because you aren’t married or have kids but you will have to buy a policy in the future.
The sad thing about not buying now is that as you get older your life insurance premiums will rise tremendously because as you age you are more bound to develop a medical condition than when you are young. When you do need life insurance you may have developed a medical condition or started a smoking habit and your rates will be super expensive. Life insurance is important to have now and this is an investment for a lifetime. Term life insurance is something you should look into because it’s the cheapest form of life insurance on the market and as you age you will thank your young self for buying a life insurance policy. Also work with an independent life insurance agent to make sure you are getting the best possible rates and they will do all the work for you.
In conclusion my millennial friend, get on the path of happiness and go the budget route. The less you think about the bills coming up and what you can and can’t spend on, the happier you will be. This budget will hold all the worries for you! Don’t forget to invest in your health too, this is something so important to have and you have to think about the future not just today. You never know what can happen tomorrow so you should have your investments in line just in case!
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