Millennials are capable but struggling generation. The circumstances have not been in their favor when it comes to finances. The challenges they face in this aspect are numerous and burdening. Let’s review them and see what can be done about them.

According to the New York Federal Reserve, Gen Y has amassed approximately $1 trillion of debt. The average Millennial carries a student-loan debt of $29,800, has less than $5,000 on their savings account, and is financially behind in comparison to previous generations.  

This is not because Millennials are incapable of providing for themselves, but mostly due to circumstances, such as the Great Recession, high cost of living, and the record levels of college costs that have resulted in crippling student-loan debts. It comes as no surprise that they’re often described as the most stressed-out generation. 

All of these challenges are too complex to fit in a couple of sentences, so we’re going to elaborate on them in the following article. Not only that, but we will also try to provide you with some directions on managing the turmoils of making and spending money responsibly. 

Living from payday to payday

Nearly 50% of millennials say they are accustomed to living from payday to payday. This can be apportioned to not earning enough money to put some aside, but also to the fact that many of them would rather enjoy spending money today than saving it for the future. Making ends meet while still managing to treat yourself from time to time is hard as it is without debts, mortgage, and other expenses.


However challenging it is, there is always a way to save for retirement or rainy days. How much you will be able to put into the piggy bank depends on your income. Try to be disciplined and save at least five percent of your earnings (pre-tax). Do this for a couple of months and attempt to increase the sum.

Constantly getting into debt

There are a few places in the world where you can get a completely free education. On the contrary, many countries, including the US, put a shocking price tag on having a college degree. As if the student debt is not burdening enough, many members of the Y generation also take loans for buying property, cars, getting married, or even traveling. In fact, it’s come to a point where Millennials often see debt as a normal part of their life. 


The best way to handle this is to take a proactive stance about managing your money. Take some time to write down all the expenses that are absolutely necessary and those that are more of a luxury. Cut down your expenses and try to get rid of one debt at a time.

Having a poor credit score

This is connected to the previous point we’ve talked about. Accumulating debt can leave your credit score devastated. Many Millennials don’t even bother to check their credit score from time to time, not knowing how that can affect their life. Bad credit score results in higher interests for mortgages and loans, and it can even increase the price of certain investments by thousands of dollars. 

Even if you have avoided using loans and credit cards, you should know that having no credit history at all can also lead to being denied a loan. Having debt and regularly paying the installment? Well, that’s what we’re talking about.

Not putting money away for the retirement

From this point of view, retirement must seem as distant as another galaxy. Currently, many Millennials are living for today, not worrying about the distant future, netting and spending money. To be fair, that’s what many young people, generations before, were doing, but the circumstances were somewhat different. 


Time is a tricky beast, and before you know it, you can end up retired without sufficient funds to spend your golden years comfortably. The sooner you start planning for retirement, the better your chances for a monthly income you would be satisfied with. 

Insurance – what do I need that for? 

When you’re in your twenties or thirties, insurance is not the first item on your priority list. But when accidents happen, and they happen a lot, and you meet them unprepared, this can cause you to accumulate more debt. 

For example, you can crash your car. Nothing serious, but just a few bumps can cost you $1,000. The treatment of some medical conditions can take thousands of dollars from your pocket and lead you to bankruptcy. Life, medical, critical illness, and property insurances are, therefore, a useful thing that can save your entire future, so give them a chance.

Struggling with housing

According to the 2019 Millennial homeownership report, more Millennials are giving up the idea of settling in their own house and planning to rent forever. This is mostly because they can’t afford a property of their own. Still, this is a double-edged sword because of the rent prices that are climbing every year. This could mean they are simply throwing the money away, buying time in a property that is not theirs and ending up with nothing of their own. 


While a classical suburbian Baby boomer house might be out of reach for Millennials, there are other options some of them are using to save the rent money for other things such as retirement. Some of them are even opting for the convenience of shipping container homes, while others are going tiny with “miniature” apartments and houses. Both options are equally affordable and eco-friendly.

The stress of it all


All of this may indicate that Millennials are taking their financial position lightly, but that’s not quite the case. They are just in a very different spot than their parents and the parents of their parents. The borrowing, unstable living situation, and making ends meet all take a toll on the health of this struggling generation. This stress can be the cause of many serious health issues, ranging from anxiety, insomnia, eating disorders and depression, to the risk of developing a heart condition and high blood pressure. So, in the midst of all this mess, pay attention to your wellbeing and mental health.

Even reading all of this can be overwhelming. But don’t forget that the sooner you start addressing these challenges, the sooner you can take action and regain your inner peace.