It doesn’t matter if you fall in the millennial, gen Xer, or baby boomer age bracket; there is a good chance you are making common money mistakes being made by others your same age.
Financial Finesse conducted a survey with more than 11,000 people, and found that each generation was making very specific money mistakes. Keep reading to see how you can avoid doing the same.
In the millennial category, only 47 percent had enough money in savings to cover an emergency. Only 40 percent even had a life insurance policy significant enough to cover their income. Of those with a retirement account available through work, only 83 percent actually contribute to it. Millennials tend to have the mindset that an $1,100 paycheck is $1,100 to spend. Rather than hold steady jobs, they are generally more attracted to fast money. They charge more than they should, and are known for splurging on name brands. On average, millennials spend more on coffee and water than other age groups, and they eat out a lot. Taking public transportation is often frowned upon, and they just don’t have the time to clip coupons. Millennials tend to live more expensive lifestyles and are concerned with impressing others, so little gets saved.
When it comes to contributing to a retirement fund, gen Xers score highly, as they have a 90 percent participation rate. On a positive note, the majority polled was saving for retirement, but only around 17 percent thought they would meet their goals.
Gen Xers are typically digging themselves out of credit card debt (the same debt millennials will be digging out of in the future). Only 53 percent make a point to pay off their balance every month.
Most gen Xers bought homes right before the real estate market took a nose dive. Others were affected by the stock market plunge, and a vast majority are plagued by student loans. They are not correctly estimating their retirement needs, and many are focusing on saving for their child’s tuition instead.
Approximately 65 percent of baby boomers polled stated they will need to work beyond their 65th birthday. They are not prepared for retirement, and they fail to diversify. Many have sacrificed their retirement fund to help their children.
It does not matter what category you fall in, you can learn from the money mistakes others are making. Most underestimate what they will need to live on in their golden years, and others assume they have plenty of time to save. Evaluate your financials and start making smart changes today.