When it comes to personal finances, millennials often struggle. Older generations sneer, saying that the youth’s money problems stem from their own spending habits, from frequent eating out to coffee shops. That criticism has some merit. A recent survey conducted by Bankrate show that the average millennial eats out or buys take-out food 5 times a week.

Yet at the same, millennials earn 20% less than the boomers generation did at the same life stage, despite being better educated. No wonder young adults are so stressed out. They even spend four hours a week on average poring over personal financial matters at the office. With all the financial pressure, one’s daily lattes become less an indulgence and more of a self-care method.

What if you are a millennial looking to cut back on unnecessary spending? Good for you! It’s never too late to start managing your personal finances. Here are some tips to help you on your way.

Set a Bulletproof Budget

This one is an oldie but goodie. Setting a budget doesn’t mean obsessively tracking every penny or balancing your checkbook before bedtime. It means knowing how much of each paycheck should go towards savings, bills, shopping, and other needs. You’ll also need to prioritize which segment needs the most money. Basic needs such as food and shelter should become your priority, and then you can move on to internet and phone bills.

Budgeting will give you a good idea of where you might be overspending, so you can trim those expenses and possibly put that money towards a saving account or an investment.

Always, Always Pay Yourself First

When you’re young, there are many temptations. But while going out and spending money is fun, 5 years from now you will wonder why you didn’t start saving sooner. Start putting aside some of your income in a savings account. Your savings double as an emergency fund in case of any unforeseen circumstances.

How much money should you put aside in a saving account?

The safe answer would be as much as possible. However, a more practical amount would be 3-6 months of living expenses in savings. The savings account should also be easily accessible in case of an emergency, such as job loss, a car wreck, or medical needs.

Invest as Early as Possible

Saving money is important, yes, but it’s not enough to help you achieve long-term financial stability. As the years go by, inflation will make consumer goods more and more expensive. Grow your money by investing. The topic of investing sounds daunting for beginners, but it isn’t as complicates as it seems. Just spend some time researching and gaining at least the basic principles.

Take the time to know your personal risk tolerance, the risk and return principle, and how to diversify and reinvest your instruments. Investment products like time deposits and bonds are considered safer, so you can look into them if you are a beginner. But bear in mind that the return rates of these instruments are lower than riskier products.

Take Advantage of Finance Apps

If there is one thing millennials are most famous for, it would probably be their tech-savviness. They are eager for tech solutions that make life simpler and easier, including personal finance. In general, most millennials consider themselves more than qualified to handle their own finances. They just want a clear view of their financial situation. Fortunately, many startups have built finance apps to satisfy that demand. The Mint app helps you categorize your spending and keeps tabs on which category you are spending money on. You Need a Budget is an app that will help you stay aware of where every penny of your money is going.


Handling personal finances can be intimidating. But if you find it too stressful, don’t hesitate to ask for help from people you trust. Let’s start saving (and investing) as early as possible for a better financial future!

A version of this article was first published on our sister company blog here.

This article was written by Funding Societies, the first peer-to-peer (P2P) financing platform in Malaysia. We provide working capital financing for small and medium-sized enterprises (SMEs); we also offer investment opportunities with returns up to 14% per year. To learn more about us, click on our website here.

You can also see our up-to-date progress and statistics in Southeast Asia here.