Why Millennials find it Hard to Save

“Despite having worked hard for years and even though I got promoted and my salary range was raised a few times, I still could not save money. Why am I failing badly in money management?”  Have you asked  yourself the same question? Do you also find it difficult to save money? You must be feeling a lot of frustration as bills pile up and your paycheck every month falls short of covering even the basic needs.

Well, you are not alone. Many millennials (and even older generations) find it hard to set an amount of savings regularly. Here are 5 reasons behind the dilemma (and how to get away it!):

1. Lack of S.M.A.R.T. Goals

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It is hard for a 20-something to envision what 10-years-after or retirement would look like. The lack of specific, measurable, attainable, realistic, and time-bound (S.M.A.R.T.) goals is one of the reasons why millennials fail to save money.

The person who knows how to break down his/her generic goals into smart goals is most likely to succeed. For instance, if the goal is to achieve 1 million pesos, one can start investing 5,000 pesos monthly for 10 years, compounding at an annual interest rate of 12%. In short, no amount of money is too small to save. You can build your wealth even with the little money that you have. The most important thing is to set SMART goals and to start saving early.

2. Failure to Budget

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Creating a budget is the basic foundation of managing one’s finances so, the lack of it would definitely lead to money mismanagement. Failure to account for daily or monthly cash in and out often leads to overspending.

To be able to save, millennials should create a realistic budget and stick to it. They should be able to analyze their income and expenses. If expenses are extraneous, it is time to adjust spending priorities.


3. Instant Gratification

While previous generations spend basically on groceries and utilities, millennials spend more on the not-so-basic stuff such as entertainment, internet subscriptions, coffee or milk tea, gadgets, fashion and cosmetics. In addition, with the existence of social media platforms like Facebook, younger ones feel pressured to show off. Just to post extravagant pictures, they do travel and buy expensive items even if it means borrowing money or swiping their credit cards.

Delayed gratification is the key. It is not an easy task, but it is something that can be learned over time. Resist any impulse buying just to brag and impress people. Sacrifice your short term pleasures now in return for a potentially greater reward in the long run.

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4. Blame Game.

“How can I save when my salary is barely enough for my basic needs?” “What is there to save when I have to send my siblings to school and pay for our utility bills and groceries?”  Many are trapped blaming people and family obligations for their inability to save. As a result, they refuse to take full responsibility of their financial situation.

What would you do if your salary is really not enough? Well, find another source like selling stuff online or offering skills for a fee. The best way to get out of a money crisis is to find a long-term solution to increase revenue streams. May kasabihan nga, “kung gusto may paraan, kung ayaw maraming dahilan.” Believe that no matter how low your income is, you can still save.

5. Procrastination.

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Many young people think that they are gifted with long life and could always make up for the lost time. That lack of sense of urgency prompts them to delay savings. But what they do not understand is that money’s power of compounding effect in the future started years ago. There is power in starting early.


Saving money is hard, but it can be done. If you want to save money, start first by developing the right mindset. Refrain from thinking that there is plenty of time, or that money will always come, or that our job is secure.

Plan while you are young, while you are still earning and healthy. Follow this simple advice: spend less, save more, earn more, and take a moment to enjoy the fruits of your labor. Despite the struggles and challenges (and temptations!), I believe millennials have every reason to get ahead and do well financially.



Divine Matibag – Cabaddu

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