Do you know that 62% of millennials are living from paycheck to paycheck, with no savings in their accounts and an average debt of $36,000? Imagine how much stress that places on an individual. Apart from that, they have to manage all their expenses within this paycheck. If for some reason, the paycheck gets delayed, they wouldn’t have any savings or a financial plan to bounce back at.
How Can You Escape from the Debt Cycle?
If it were easy to make money without help under the market conditions today, everyone would be doing it. But almost all of the millennials are in debt and there’s a reason why; the lack of financial planning. This is why every millennial who wants to be successful in today’s age, needs a financial plan. More importantly, they need to stick through that financial plan. Otherwise, any time their paycheck gets delayed or they have to quit the job, it’d spell disaster for them and the people who rely on them.
So, if you’re a millennial struggling with finances, worry no more. Read through this article to find out in what ways can a financial plan help you secure a better future.
Do We Have Equality of Opportunity?
In the U.S.A, we all believe that everyone should have equality of opportunity. Many cities in the United States of America are worldwide famous for being a hub of opportunities. Every day is like a new day for opportunities and so people believe in this. However, that is not the case. As much as we want equality of opportunity for everyone, unfortunately, it isn’t how the world operates.
Financial researches suggest that the chances of your success depend upon where you’re born and in which racial group. In other words, if you come from a disadvantaged background, you’re less likely to make it big in the financial market without help or a fixed financial plan to rely upon. That is the reason why most millennials are living in poor circumstances. It is because either they don’t have a plan or lack an advantageous position. Similarly, someone with a wealthy background can use it as a favor to ascend higher. This is more commonly known as the birth lottery. This birth lottery is a major reason why research conducted at Pew Research Center found the median amount of loan debt millennial carries to be $19,000.
Why Does it Matter?
This is an alarming situation for millennials, who are stuck in the endless cycle of student loans, home mortgages and entrepreneur debts. What this means is that if they don’t have a financial plan, they are likely to remain stuck in an endless cycle of debt. Therefore, if you’re a millennial, you need to have a financial plan. It would help you understand the market and advise you to invest in profitable stocks. Thereby, curbing the impact of the birth lottery on your finances.
An important reason why you need a plan is that it will be your defining value. It will determine which kind of jobs you should take that’ll prove to be beneficial for your career. It will also outline the monetary goals you want to achieve, as well as the goals you’d be willing to compromise on.
Frequent Life Transitions
Another reason why millennials need a financial plan is because of the frequent life transitions. In today’s fast-paced world, they go through several sudden changes. These changes put them through stressful conditions and if their finances are poorly planned, chances are that they wouldn’t survive the fall. Let’s look at some of these transitional phases in their life that they need a plan for.
Education and Work
From university applications to investing in their start-up, it can be a bumpy ride. This involves countless people taking up student loans or entrepreneurial debts to start their own business. It’s one thing to take a debt but the constant pressure of returning it can become stressful. It can become so much trouble that a lot of people crushed under their weight. Instead of focusing on the word, they are troubled by the fact that they have to return the debt. This happens when you don’t have a stable plan that you can rely upon or follow.
Financial Family Planning
After that, they have to invest in family planning as well. Family planning isn’t an easy task. It is an extremely intricate matter which involves a lot of safety planning and finances. It includes supporting people who are going to depend on you for money. At some point, it can also mean investing to buy your own house. Also, with family planning, you have to set budgets for children’s educational funds as well.
In other words, their changing economic and social needs put them through a financial crunch throughout their ride of life.
Generation Stress
Similarly, millennials are also more prone to generation stress. That is to say that they are living at a time where the generation before them is still alive and working. This means that to secure a job, they have to compete with people who are far more experienced than they are. Moreover, they are expected to start their own family too. This places them in a stressful position. To deal with these transitions and stress, they need a professional financial plan.
Learn Monetary Discipline Today
Success is a road that often comes without a road map. But there are still certain factors that can help you achieve success. The most important of those factors is deciding on a financial plan for yourself and your investments. This way, you can be sure of longevity and success.
It’s because millennials are born in turbulent times with rapid growth in all facets that they find it difficult to maintain discipline in their finances. A lot of millennials find themselves stuck in a loop of escaping unemployment. Because of that, they are rarely able to save money. Since there are no savings, there is no money for investing as well. In other words, they get stuck in a continuous loop of paying off finances, rather than saving them.
If you want to fix these troubles and live a steady life, then you need monetary discipline. In other words, you need a proper and functional financial plan.
Emergency Situations and How to Deal with Them
If you plan things ahead of time, they’d help you with emergencies. Nowadays, the world is crippled because of the pandemic. This is one example of a crisis that millennials can face. Apart from this, other countless routine examples can cause a crisis. Instability in the market or their job is another example. The only way you can survive these emergencies is if you have made a plan for your finances and follow through it. Otherwise, without an action plan in place, likely, you wouldn’t survive the emergency circumstances.
The presence of a plan can help you understand how to spend, save and invest regularly. It will also be a constant guide to help you decide your investment philosophy and growth strategy.
Equip Yourself to Deal with Market Turmoil
One of the most crucial reasons why millennials need a plan is because of the unpredictable nature of the market.
There is no doubt in the fact that millennials face the most uncertain future in today’s market condition. The gap between rich and poor is furthering day by day. People are finding it much more difficult to find a long-term stable job. This means that it is much more difficult to invest in savings for a stable future. Moreover, many people are unemployed and most of those who are employed are working for minimum wage.
To excel in any market, one must be qualified enough to handle the intricacies of that market. The financial market is one such place where the assistance of a qualified planner will help you deal with it better. So, to make a secure plan, do consult with a financial planner as well. Financial planners offer you expert advice that you cannot learn on your own. Therefore, they are best suited to help you in making successful decisions for a better and secure future.
How Do I survive As an Entrepreneur?
Research’s results show that more than half of Americans have cried over their financial situations. The situation is more alarming than it seems because over 70% of millennials feel anxious if their paycheck is delayed by only a week. Furthermore, the majority of the young American population has less than $1000 savings in their accounts.
One clear thing is that getting success as an entrepreneur or a new business without a financial plan in place is risky and might push you in a deeper ditch of financial debts.
Conclusion
In conclusion, if you’re a millennial who wants to be successful in today’s market, you need the active presence of a financial plan in your life. That plan will equip you with the necessary tools to make it through turmoil and move towards success if you follow it.
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