Every year-end is a time for people to look back and reflect on their lives. It’s also the time when they plan, especially financially. For older adults, their financial goals might focus on retirement, estate planning, and getting out of debt. For Millennials (anyone born between 1981 and 1996), on the other hand, their top concerns might be saving for their kids’ education, home purchasing, and planning for a comfortable retirement. How about Zoomers, the generation that was born between 1997 and 2012? What financial goals can they set for themselves?
In 2022, Zoomers will be between nine and 24 years old. If there’s one word to describe this generation, it’ll be ‘digital native.’ They’re fluent in social media, comfortable using gadgets, and apps, and can effortlessly navigate the digital world.
So, what are some financial goals that Zoomers can aim for in 2022? Here are six that might be worth considering:
Invest In Stocks
Some people think that stock investing is only for the rich. But the truth is, investing has its place among all income levels. It’s a great way to build a significant nest egg. Zoomers should start investing, even if their incomes are still low. This way, they can begin building wealth for the future. However, before investing, Zoomers should research before choosing investment products as there are relatively riskier stocks than others, such as penny stocks.
Penny stocks are stocks that trade for about USD$5 or less. The stock price is low, which easily entices novice investors. However, the stock price is often manipulated. Only big investors can profit from it. The SEC warns that investing in penny stocks may lead to fraud, and unprofitable companies usually issue them. For Zoomers who still have a lot to learn about risk, it’s best to focus on penny stocks alternatives such as low-cost index funds and blue-chip stocks.
Establish A Good Credit Score
Establishing a good credit score will help Zoomers get the best interest rates for car loans. Zoomers should establish a good credit score by paying their bills on time and keeping their credit card balances low. Not only that, they should read the fine print of contracts and understand all the terms and conditions to avoid falling into any credit traps. It’s also important for Zoomers to understand what a good credit score is and the factors that affect it, as this will help them know what to do to achieve it.
Pay Off Debts
Older generations cab be burdened with debts, even if they have a good income. Thus, even if a Zoomer has a steady source of income, it’s still important for them to slash their debts as having too much debt might affect their credit score.
Loans such as credit cards, car loans, and home equity lines of credit are examples of debts. Zoomers should avoid incurring unnecessary loans as much as possible. They may achieve this by borrowing cash only when it’s necessary.
Build An Emergency Fund
One of the most important goals that Zoomers can accomplish is to build an emergency fund for unexpected expenses and emergencies. Having an emergency fund will enable them to stay afloat during difficult times. They also have a place to draw from whenever they need quick cash for medical emergencies, car repairs, and other expenses.
Open A Savings Account
Zoomers should start saving for the future as soon as possible. It’s never too early to start putting away some money for the future. A savings account is a safe place to put cash while earning. Find a bank with reasonable rates and minimal fees to make the most of your savings.
Invest In Cryptocurrency
Cryptocurrencies are decentralized digital currencies, and it has no central authority. It’s run by its users using a peer-to-peer system. Since Zoomers are born in the digital generation, investing in a digital currency like Bitcoin is another excellent addition to their 2022 financial goals.
Understanding the basics of cryptocurrencies is crucial to investing in crypto effectively. They may read or watch videos about it to know how it works. Finding a good mentor is also recommended, and getting advice from seasoned investors before deciding whether or not to invest. Being an informed investor will also help minimize the risks of cryptocurrency investing.
Final Words
Financial goals are part of almost everyone’s priority list, and Zoomers are no exception. Scoring a job that pays well is also essential, but it would be useless if they cannot make the most out of their income. Aiming for high earnings alone is no guarantee that their finances will remain in good shape by 2022 and beyond. However, following the financial goals listed above will be a big step towards Zoomers’ stable and secure financial future.
This article is for information and educational purposes only and does not form a recommendation to invest or otherwise. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.