Getting the Most out of Life
Looking for Money Advice Beyond Your Parents
According to the recent Millennial Money Study: Facts, Figures and Findings conducted by Fidelity, one-third of Millennials reported that their parents were their most trusted source for financial advice, with nearly 60 percent stating that their parents are great role models for managing finances. But are parents really your best source for money advice?
Now vs. Then
Today’s Millennials have vastly different financial situations than their parents did at their age. Americans now collectively owe over $1.2 trillion in student loan debt due to the rising cost of college. Back in 1970, when many parents of Millennials were attending college, the cost of tuition at a public university was $1,287. It wasn’t uncommon for a student in the 70s to attend school for a trimester or two, then take off a trimester to work. Today, it’s proving to be extremely challenging for students to pay for school as they go, especially if they go to a private college, which averages $31,231 per year for the 2014-2015 school year.
Student loan debt isn’t the only burden weighing down this generation: According to Fidelity, 41 percent of Millennials label credit card debt as their number one financial hurdle. According CreditCards.com, “A person born between 1980 and 1984 has on average $5,689 more in credit card debt than his or her parents (those born between 1950 and 1954) at the same stage of life.” Factor in cell phone bills and data plans, monthly Wi-Fi costs, and the drastic difference in gasoline prices, and you have a brave new world of monthly expenses.
Who to Turn to Instead
Alarmingly, Fidelity also states that 23 percent of Millennials reported trusting no one for money advice. The reality is, however, that Millennials have more options for specialized financial guidance than any previous generation. Besides the wealth of free information available online via personal finance blogs, there’s now a whole network of financial planners out there that are geared towards Gen X and Gen Y clients, such as the XY Planning Network. This makes it simple to search for a CFP(R) who provides specific financial planning services on a monthly retainer.
For those in serious financial trouble who find it difficult to keep up with monthly payments, the nonprofit National Foundation for Credit Counseling (NFCC) offers trained counselors that can help rebuild credit, figure out a debt repayment plan, and assist with bankruptcy counseling.
Don’t let yourself get into dire financial trouble. There are resources at your fingertips — beyond calling your parents — that will help you build a strong financial foundation. A little time focusing on your finances now will go a long way in the future. But don’t forget to call home, if only just to check in.