Although we Millennials have less cash than our parents had at their age, we tend to spend more on experiences rather than goods.
This includes things like clubbing, skydiving, destination birthdays, you know. We’d rather not miss out on an experience even if it drains us financially.
However, there are a few things Millennials just really hate to spend money on. Whether it feels like a waste of money or just doesn’t make sense, here are the top five things Millennials just can’t put their dollars towards. But, maybe we should start!
Investing in an IRA or 401(k) can feel like the last thing on a Millennial’s mind. When you have massive student debt and a rent payment, how on earth are you supposed to put money towards the future?
However, investing in retirement is something that Millennials should ideally start doing by the time they’re 25. Putting away even a small percent of your money can help majorly. While many of us aren’t able to put away the 10-15% of recommended income towards retirement or savings every year, even 5% makes a difference.
Getting set up with an IRA is easier than you think. Start investing to save and stop blowing your retirement income!
2. Health Insurance
It can feel like you’re just too young and lucky to get sick. Forgoing health insurance—especially after going off your parents’ insurance at 26—is a huge mistake that many Millennials make.
Whether or not you have any chronic health conditions, accidents happen. Relying on someone else to pay your medical bills in the event that you get sick or need to be hospitalized is just irresponsible. It’s not that hard to educate yourself about marketplace insurance and sign up for some coverage.
Health insurance is more affordable than you think, especially when you consider the high cost of medical bills. Millennials feel like the premium just isn’t worth it—trust me, it’ll pay for itself when you need it.
3. Cheap Beer
This one is interesting. Millennials tend to be pickier than older adults when it comes to craft beers rather than going for cheaper, domestic options.
Yes, that’s right. Nearly 45% of Millennials just think that craft beer tastes better. When given a choice, they’ll generally choose indie beers rather than brands like Coors or Miller even though they’re more expensive.
Spending money on cheap beer does feel like a waste and doesn’t make sense. When it comes to cutting corners, this is one expense that maybe is worth it for selective Millennials and their cash!
Although the vast majority of Millennials plan on owning a home one day, data shows that Millennials are just not buying houses like they used to.
The majority of Millennials rent, but this is less about them enjoying the rental market than it is about Millennials just not having the funds to purchase a home. Since a home down payment is typically 20% of the home’s purchase price (unless you want to pay Private Mortgage Insurance), this is a hefty sum.
Millennials just don’t have this kind of cash.
In fact, Millennials are much less interested in buying a home or even buying a car than they used to be. With less access to funds and a more transportable lifestyle, Millennials will be renting for way longer than their parents did.
Is this a good thing? You tell me. Each has its pros and cons, and Millennials are smarter to not buy houses unless they’re financially able to do so.
5. Costco Memberships
Buying in bulk just doesn’t make sense for Millennials who have small apartments and a live-in-the-moment, urban lifestyle.
However, buying in bulk often can save Millennials some major cash.
Millennials are shying away from Costco memberships on account of their cost and also the logic of it—where will I put that giant pack of toilet paper? Why would I spend $200 on a 6-month supply of meat when I could buy a $5 hamburger today?
Buying in bulk makes sense, yes—but for Millennials, they’d rather not spend their money on what they see as a waste.
Millennials don’t always see their purchases as extravagant or wasteful. Buying a tasty craft beer is surely better than downing a Bud Light on Friday night. Investing in retirement? Isn’t that 50 years away? Getting a Costco membership when you don’t have a home or a car just seems silly.
But health insurance? You should definitely have that. Be wise with your funds!