Life is, among other things, a learning experience. Young Millennials are learning as they grow, but some trends have developed displaying a few consistent financial mistakes.
Without effective budgeting we train ourselves to be financially limitless, which can have devastating consequences. Without budgeting we place many facets of our lives at risk, including any savings and the lack of control over debt.
Mismanaging credit cards
Hand in hand with a failure to budget is credit card abuse. Millennials appear to be consistently making two financial mistakes here: debt-to-credit ratio abuse and not paying on time.
Both of these result in lower credit rating scores. Millennials are using their credit extensively, which is not what additional potential lenders and credit providers want to see. Late payments exaggerate the negative impact and credit suffers.
Renting instead of buying
Millennials are renting far longer, which may be more an indication of the financial status of the nation, but it is having a negative effect on their generation. As the housing markets improve, more Millennials are buying property, but the numbers are still low. In addition, while renting they fail to take advantage of renters’ insurance, placing their possessions at far greater risk.
Not saving for retirement
It may be easy and understandable for the young to wait on this option, but the longer you wait, the less you accumulate for your retirement. Millennials seem to be waiting longer and placing their retirement at greater financial risk.
Passing up life insurance
There are no guarantees in life beyond death and taxes. And that first one can happen unexpectedly. Life insurance coverage bought early is far less expensive, especially if you develop serious health problems before you start buying it.
For answers to all your Texas insurance coverage questions contact The Schwab Agency, proudly serving clients in the Dallas/Ft. Worth area.