How Can Today’s Millennials Gain Financial Freedom This Independence Day
This Independence Day, we believe it’s time for millennials to take stock of and secure their financial independence
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It’s been 72 years since India’s tryst with destiny, and we sure have come a long way. Today, the country is on its way to have the youngest workforce in the world — with a whopping 64% between the ages of 25 and 34. They’re also on track to become the most skilled generation to date — thanks to an increased access to education.
As a result, they are more open to different opportunities, career paths, and ways of life. They are no longer tied down by fatalism like their elders, and tap into the power of ‘smart work’ to get them where they want to be. So, how does this change their perspective towards money? Millennials today, are more comfortable with the idea of loans, EMIs, and money in general.
This Independence Day, we believe it’s time for millennials to take stock of and secure their financial independence.
So, what does financial freedom mean to millennials?
It could be a sense of achievement born out of their first hard-earned salary, going for a self-funded foreign vacation, or launching that dream business venture. In essence, financial freedom is the ability to be able to spend money without the constraints of too much planning — though it may manifest itself in varied forms.
But no matter what it means, financial independence is not an easy dream to achieve. While the general trend among young millennials is to forsake long-term investments in favor of short-term satisfaction, this mentality tends to fade over time as they become more financially accountable over time.
Nevertheless, no matter which stage of the journey millennials are in, there are certain money rules that’ll ensure they’re always independent, finance-wise:
1. Always plan-ahead: Every long-term goal requires a fair bit of planning, and money is no exception to this golden rule. If one is serious about achieving financial independence, then mapping out definitive goals is a great way to instill a sense of discipline. They can start by setting time-based goals, targeting accomplishments by the age of 25, 30, 35, 40, and so on.
2. Prioritize major spends & finance judiciously: Taking a loan is much easier today than even five years ago. However, one needs to prioritize major expenditures and plan their finances well. For example, financing a Macbook at the same time as taking a loan to visit an international destination can be an added burden! Also, it’s important to manage one’s monthly expenses well and not miss out on any utility payment or credit repayment deadlines, to avoid a negative record and repercussions on future financing avenues.
3. Invest, invest, and invest: A great way to build savings is by investing in various short- and long-term schemes. Short-term investments include putting money into liquid assets, mutual funds, or Equity-linked Savings Schemes (ELSS), which can help in emergencies. In long-term, investments are spread over a longer tenure to meet larger financial goals. Investing in Public Provident Funds (PPF), gold, and long-term bonds are great ways to build and achieve financial freedom.
So, with some planning and a pinch of financial discipline — millennials can be well on their way to a free and easy retirement!
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.