Money is a sensitive topic for many people, and it can be especially tricky to navigate when discussing money between generations. Millennials are often told to save more, invest better, or make smarter financial decisions – but do Boomers always have the right advice? Here are some of the most common pieces of (misguided) financial advice that Boomers give Millennials.
“Just Buy a House; It Will Always Go Up in Value!”
Real estate is not always a sure thing. Property values are highly volatile and fluctuate depending on the state of the economy. Also, in the last decade, house prices have skyrocketed, making it difficult for millennials to consider homeownership. So, this advice may not be relevant today or may not be practical for many.
“Live Within Your Means”
This advice is good, but it’s too simplistic. Millennials should be encouraged to save and budget to reach their financial goals. However, the focus should be on creating a plan to build wealth over time rather than just trying not to overspend.
“Always Pay With Cash”
Some Boomers may advise Millennials only to use cash for purchases, but this isn’t always the most cost-effective way to pay. Credit cards have many benefits, like earning rewards points and building your credit score, which can give Millennials an advantage over cash. The key is to make sure you pay off your balance each month.
“Invest in Stocks and Mutual Funds”
Stocks and mutual funds are popular investment instruments, but they’re not suitable for everyone. Investing in real estate, cryptocurrency, and peer-to-peer lending are all viable alternatives. Millennials should be encouraged to explore financing options that fit their goals and risk tolerance.
“Don’t Worry About Retirement”
Retirement is one of Millennials’ most important financial goals and should be taken seriously. Boomers often give this advice because they have savings already accumulating and may not understand the importance of starting early. Encourage Millennials to start saving early to ensure they’re prepared for the future.
“You Must Go to College to Be Successful”
Post-secondary education isn’t the only path to an accomplished life. As technology continues to evolve, more opportunities are becoming available. Millennials have many options, such as technical schools, apprenticeships, and trade programs that can lead to successful careers. How can we forget social media and the immense influence it has on the world? No matter the path, no one should be discouraged from pursuing their passion and building a successful life.
“Investing Is for the Rich”
Investing is a great way to build wealth and it’s not just for the rich. Millennials can start investing with little money and should be encouraged to do so at an early age. The stock market, for instance, can provide high returns if you understand the risks, and investing can help millennials reach their financial goals faster than other methods.
“Don’t Discuss Your Salary With Others”
This is an outdated notion that does not always apply in today’s world. Talking about your salary can help you understand what other people are earning and how your compensation stacks up against the industry standard. This information can be helpful when negotiating a salary or benefits package and understanding the value of your work.
“Get a 9-5 Job With Benefits”
This advice is outdated. The traditional 9-5 job model is only one of many routes to success and, in many cases, not even the best one. Millennials are encouraged to explore different career options, such as freelancing and remote work. These are becoming more common and may offer more flexible working hours and a better work-life balance.
“Pay for College Through Work As I Did”
This advice ignores that college costs have skyrocketed over the years, making it difficult for Millennials to consider paying for college through work. Instead of making unfair comparisons, Boomers should support Millennials by helping them explore grants, scholarships, and other financial aid they may be eligible for.
“Stick With Your Current Job So You Don’t Seem Unreliable”
While it’s essential to be seen as reliable in the workplace, it should not be at the expense of career growth or fulfillment. If a job no longer aligns with your goals and values, it’s okay to explore other opportunities that may offer more personal satisfaction.
“You Need a Lot of Money to Be Happy and Successful”
Money is a means to an end, but it’s not the only way to cultivate happiness and success. Having meaningful relationships, pursuing passion projects, and exploring ways to give back to your community are paths that can lead one toward lasting fulfillment.
“Put Your Money in the Bank and Don’t Touch It”
Although saving money is important, there are better ways to grow your money than leaving it in a savings account. Boomers may have good intentions when they pass down this advice, but inflation and taxes can erode savings over time. To really make the most of your money, invest in financial vehicles with low fees and a track for steady returns.
“Start Saving When You Make More Money”
Saving money should not have to wait until your salary increases. Millennials should start saving as soon as possible, even if it’s a small amount. Setting up automatic transfers will make the process easier and help build healthy savings.
“Quickly Have Kids”
This advice is not relevant to today’s world. Having children is very expensive and comes with a lot of responsibility; you must be financially and emotionally prepared before taking on such a significant life change. So, Boomers should not pressure Millennials to start a family before they are ready.
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