A large proportion of millennials entered the job market at a time when financial markets were extremely volatile. Not surprisingly, many studies across the globe find that the generation has grown wary of stock markets. In India, too, millennials appear to be wary of the stock markets.
It is said that we first make our habits, and then our habits make us. Save more, spend less and avoid unnecessary debt are a few good habits that can ensure a financially comfortable life. However, people, including those who are financially literate, also pick up bad habits that ultimately disrupt their finances.
If you are in your 30s, the following habits will help you create wealth. If you adopt smart investing habits, you could be on your way to financial freedom. Here is a small compendium of habits to make you successful as well as assist you in achieving your life goals.
1. Create Life Goals
Many people are ignorant about what they actually want. Life throws various choices that can be confusing, this results in bad decisions. It is important to identify your goals, whether small or big. When you set goals, you can plan to achieve the goal, and if you plan, you can set deadlines. It’s simple. One thing leads to another. Goals help you to have a clear vision and set up the road-map to achieve them.
2. Plan
You are likely to achieve your goals if you maintain a to-do list. If a thought comes out of blue, note it down. It will provide you an opportunity to reflect on your goals, and also help to set a concrete road-map in action.
3. Automate Investments
Many self-made millionaires vouch when it comes to automating their finances. This simple habit helped them to achieve financial freedom earlier than anticipated. You should automate your investments by ensuring automatic SIP in different funds. It saves you time and energy. You don’t have to look at your portfolio every month. This also shields you from worrying about short-term underperformance.
4. Pay Off Your Debt
Debt is good, but only if it is a debt fund. Debt is your biggest enemy, it eats your income. As you grow older, it becomes difficult to earn money. The 30s is the golden period to make money.
If you have a mortgage, you must make it a priority to pay it before the age of 45. If you pay off your debts, you can save big money that goes to pay high interest.
If you embrace the above habits now, you are on your way to financial freedom sooner than you think.
5. Invest
The amount of savings and investments determines your tomorrow. On average, a millionaire invests 25% of his income each year. This helps them to create multiple streams of income over a period of time. Remember, your wealth is not measured by the amount of money you make, but by how much money you have saved and invested over the period of years.
How millennials in India invest their Money?
Millennials refer to those who attained adulthood in the early 21st century and grew up just when the world became more digitally connected. Among older millennials, 48% invested in equities, while among younger millennials, the figure was 4%, data shows. A higher share of the older generation (54%) made equity investments of some kind.
The data shows that there is no stark gender difference among working millennials when it comes to investments. However, the share of millennial men investing in equities is a bit higher, compared with that of millennial women.
Compared to their older generations, millennials are less likely to invest in each of the financial instruments for which data was collected. However, the difference between older millennials and younger millennials seems sharper than the difference between older millennials and Gen X.
The tendency of millennials to consume more and save less may also explain why millennials tend to invest in lower numbers compared with older cohorts. Nonetheless, income differences could be a bigger explanatory factor.
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