The Ten Absolute Worst Money Mistakes For Millennials

March 9 2016

 10. Using a Savings Account as a Retirement Account

Bank accounts – great for emergencies & spending, bad for growth. Savings accounts are averaging less than .1% per year of interest, well below the rise of inflation. Your saving account should be for spending and emergencies – with at least 6 months of salary stashed away. After you reach that threshold it’s time to put your money to work for you.

9. Not Knowing What Investments You’re In

You have an old 401K from your last job and you don’t know the investments in your current 401K. You also have some CD’s from ten years ago and a stock your grandma bought for you. Finances are confusing for a lot of people, but in ten years I promise you will wish you didn’t ignore your investments. The difference of just 1% per year could mean over $100,000 at retirement. That’s your grandkids college or one pair of yeezy’s. Take the time to sit down for at least an hour and study up on what investments you’re in.

8. Insurance is for the Elderly

You’re young and invincible – I understand that. Millennials tend to think they are Superman in a world without kryponite – but your parents/spouse/kids won’t think the same way when you leave them with your debt and without your income. Insurance is like a plunger – if you don’t have it the moment you need it, then you might be in deep…trouble.

7. Being as Safe as possible

Kids take risks every day. Have you ever seen a ten-year old skiing? They have zero fear because they know when they fall it won’t hurt too bad. You can afford to fall in the stock market too. Don’t listen to the news talking about a financial apocalypse because it doesn’t concern you yet. On average, the stock market has made over 10% per year, ignore the circus and focus on the end goal.

6. Ruining their Credit Score – or not having one at all

We’re raised to believe that credit cards are bad – they’re not. But as every parent, financial advisor, and fraternity president has once said: moderation is key. Get a credit card, pay it off in full every month. Hell – get two credit cards if you feel so inclined. Having good credit is a cornerstone to accumulating wealth, and if you don’t have credit history then you won’t have a credit score. What’s that mean? Higher student loans, higher mortgage, higher debt – and less cash in your pocket.

5. I’ll Give When I’m Rich

There are a million things to do with excess cash. Maybe you’re not Bill Gates and you can’t throw money at every charity of your choosing – but giving to those in need is an essential part of money management and it’ll make you feel nice and cozy along the way.

4. Over-concentrating on Debt

The thought of coming out of school with loans feels a lot like watching a Tidal wave come directly at you. You already know its going to ruin your day when it finally hits. The average student is leaving school with over $35,000 in student loan debt with graduate students being much higher. The good news is that you’re not alone. Soon you’ll realize that Tidal Wave is more like a thousand small waves – easy to handle as long as you stay above water. Keep paying off above the minimums but don’t ignore your retirement in the process.

3. Forgetting to invest in Themselves

The only way to make more money is to be the absolute best at what you do. You can be a great saver but that will never replace higher income. Look into a new academic designation, graduate school, or personal trainer and it might pay dividends to your future that investing can’t.

2. Not Saving Enough

It’s great that you put 3% into your 401K every month but it’s not enough. If you’re spending 97% of your income it’s time to take a serious look at your budget and cut your spending. Anything less than 10% might lead you into hot water and the longer you wait the worse it will get. Pick a percent that you want to save and treat saving like another bill to make it easier.

1. Thinking “I’m Too Young for This”

Ask anyone over the age of 45 and they will agree with me here – you are never too young. If I could go back in time and teach my 5-year old self to invest, I’d do it. The best time to plant an apple orchard was 20 years ago, and the second best time is right now.

Eric Croak is an Investment Advisor Representative with Creative Financial Partners in Perrysburg, Ohio. He has his Series 7, Series 66 and his Life and Health Insurance Licenses. He can be contacted via email at or through phone at 419.873.8500 ext. 1033

Securities and investment advisory services offered solely through Ameritas Investment Corp. (AIC). Member FINRA/SIPC. AIC and Creative Financial Partners are not affiliated. Additional products and services may be available through Eric T Croak or Creative Financial Partners that are not offered by AIC

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