Financial Tips for the Messy Millennial Trying Their Best
Ever woken up with last night's makeup still on, an uneaten slice of pizza on the bedside table, a jackhammer in your head, and an account balance that only adds to your already building nausea? Ever spend way too much on take out because you're just too exhausted from your job—that doesn't pay you nearly enough for your long hours—to cook? Or maybe, tired of the unhealthy work/life balance your company offers instead of benefits, you spontaneously booked a plane ticket to some Instagram worthy island, and decided you'd figure out the money part later, after all, everyone on Instagram seems to be on vacation. We get it, and we don't blame you.
Being a young professional in 2019 means a whole host of challenges your parents never had to worry about. Between the toxic culture of non-stop productivity, mounting student loan debt, the tendency many companies have to take advantage of millenials, and the way social media forces you to compare yourself to your peers; it can feel like getting ahead financially is a losing game. And when that non-stop stress builds to a breaking point, it's understandable that you may start to let financial best practices fall to the way side in order to stay sane. Your mom is going to tell you the same thing over and over: budget, don't go drinking, eat at home etc. and while that's all good advice, the truth of the matter is your life isn't simple and the world is changing around you all the time. With the specific struggles of the average millenial in mind, here are our top financial tips for people just starting out in, what baby boomers would call, "the real world."
Take a Course
We know, this is adding another expense to your already tight budget, but we promise if you can find the money for an online course in basic finances or economics, it's worth doing. It's absurd that people are just suddenly expected to emerge from college fully equipped to handle things like taxes, budgeting, and investing, when just a month before they were eating ramen in a dorm room doing homework for a class called "the post modern implications of beekeeping." There are even some free options out there.
Get a Cheaper Apartment
We know, sometimes this just isn't an option, but be honest with yourself, how hard did you look for a more affordable apartment? Or did you just make whatever work so you didn't have to think too hard about it? In many cities, there are options for rent controlled apartments, and even housing lotteries to help you take your money farther. As a good rule, housing should be 30% of your income. If it isn't, or that just isn't a possibility for you right now, think about how you can cut down on costs of living. Could you get another roommate? These kind of savings are ideal, because they don't require will power to maintain the way so many financial tips do.
Yes, we know this sounds counterintuitive, but there is something to be said for making investment decisions that don't exactly feel safe. Millenials have been told their whole lives to be careful with money and to work hard to hang on to material security, but the problem with playing it safe is you're very unlikely to see any returns. Investigate the options you have for your savings, and don't be afraid to make minor mistakes, afterall, there is no better way to learn.
Don't Depend on Your Credit Cards
A classic mode of budgeting back in the day was to get all your monthly spending money for the month in cash, divide it up into envelopes (groceries, eating out, drinks, entertainment etc.) and then if the money in the envelope runs out before the end of the month, well, that's that. Most millennials rarely carry cash, but maybe it's time to consider going old school. If you take a certain amount of money out of your "going out" envelope before a night at the bar, you're much less likely to get carried away than you would be with a debit card on an open tab. Once the cash is gone, you know your budget for that particular area of your life is used up, and you're less likely to accidentally overspend.
Pay into an Emergency Fund
Many millenials report having very little back up plan were they to suddenly lose their job or suddenly need a significant amount of money. To avoid this situation, follow the age old rule: pay yourself first. That means pay into your savings every paycheck, even if it's just a small amount. Most importantly, this practice creates good habits of saving, and you'll begin to understand the satisfaction that comes with watching a savings account grow.
Looking for a job? In addition to encountering those annoying never-ending job interviews you may find yourself face-to-face with an artificial intelligence bot.
Companies worldwide increasingly use artificial intelligence tools and analytics in employment decision-making – from parsing through resumes and screening candidates to automated assessments and digital interviews. But recent studies claim that AI does more harm than good.
While AI screening tools were developed to save companies time and money, they’ve been criticized for placing women and people of color at a disadvantage. The problem is that many companies lack appreciable diversity in their data set, making it impossible for an algorithm to know how people from underrepresented groups have performed in the past. As a result, the algorithm will be biased toward the data available and compare future candidates to that archetype.
The City’s Automated Employment Decision Tools (AEDT) law is designed to offset the potential misuse of AI and protect job candidates against discrimination. It was enforced on July 5th, 2023 in New York City - with other cities and states expected to gradually follow suit. Employers must now inform applicants when and how they encounter AI. Furthermore, companies have to commission a third-party audit of the AI software used, and publish a summary of the results to prove that their systems aren’t racist or sexist. Job applicants are able to request information regarding what data is collected and analyzed by the AI. Violations of the law can result in fines of up to $1,500.
Replacing Human Hiring Decisions
However, should a job applicant want to opt-out of such impersonal judgement by a bot, the new law's scope is quite limited.
While the law specifies that instructions for requesting an alternative selection process must be included in the AI screening disclosure, companies aren't actually required to use other screening methods. Not to mention that the law only applies to AI in hiring and not any other employment decisions. It also wouldn't apply if the AI, for example, flags candidates with relevant experience, but a human then reviews all applications, making the ultimate hiring decision.
Some civil rights advocates and public interest groups argue that the law isn’t extensive enough and that it’s even unenforceable. On the other hand, businesses say that it’s impractical, costly, and burdensome, and that independent audits aren’t feasible.
Responsible use of AI in hiring
Although this law may be a good first attempt to assign more regulatory guardrails around AI, it remains to be seen if it ensures the responsible use of AI in hiring processes. At the end of the day, perhaps recruiting talent should remain a human-made decision.
The good news is that AI can help companies without harming potential job candidates in many ways – such as connecting new employees with internal organizational information and company benefits during onboarding. Or helping employees to do their jobs more effectively rather than replacing them.
There’s all this talk about solo travel. And for good reason — no wasting precious time waiting for others to get their act together, take the plans out of the group chat and actually buy the tickets. Going solo, you can be spontaneous. You can plan your trips according to your precise tastes. You can hop on any flight and fly awayyyyyy.
But what if each time you flew you’d get a free ticket? That’s what you get with the Southwest Companion Pass.
Award status, upgrades, lounge access — there are many perks in the frequent flier game. But one of the coveted holy grails is the Southwest Companion Pass.
What is the Southwest Companion Pass?
The Companion Pass is part of Southwest’s Rapid Rewards program. You get to choose one person to be your “companion,” and they fly with you for free (plus some taxes and fees) on every flight. That’s right. Two for the price of one. That’s half off each ticket if you split it! Whether you’re flying with a partner, family member, friend, or anyone else, they can tag along for free.
And it gets better: once you earn the pass, you can reap the rewards for that full calendar year … AND the next. That’s why people go mad trying to earn a companion pass during the early months of the year. The sooner you qualify, the longer you can use it.
There are also no blackout dates. There are no limits. And if you didn’t purchase the ticket (think: work travel, your companion, or a generous benefactor), there are no restrictions! As long as you’re the one on the plane, your companion can also … be on the plane.
You can also switch out your designated companion 3x a year. So, no need to stay in a relationship simply to get the most out of your companion pass! Ghost and fly away — with a whole new companion!
If this sounds too good to be true — it’s not. But there is one small catch. It’s kinda tough to earn this mega reward.
How to qualify for the Southwest Companion Pass?
You can qualify for the pass in one of two ways:
- Fly 100 qualifying one-way flights
- Earn 135,000 qualifying points in a calendar year.
Clearly, this is no small feat — especially if you’re trying to qualify ASAP.
So how do you actually earn the Southwest Companion Pass?
Don’t worry, there’s a path to earning this amazing reward without climbing on 100 flights or spending an exorbitant amount of money.
Earning 135K reward points may seem completely impossible, but it’s easier than it sounds. Simply sign up for a Southwest Credit Card and turn those spending habits into a rapid rewards account. Through the Rewards Priority Credit Card, earn points when using local transit and commuting, plus score major points and miles whenever you spend.
Stay with me here. This is not some scheme to get you into credit card debt. Many airline cards come with potential savings, giantic rewards, awarding you points, and cashback with every purchase you make that can be redeemed for travel. And often they can come with passive sign-up bonuses. If you spend a specific amount of money within a certain timeframe of opening the card, you can be in for a windfall of points.
Now that’s where the companion pass comes in:
- Southwest Rapid Rewards Premier
- Southwest Rapid Rewards Plus Credit Card
- Southwest Priority Credit Card
- Southwest Rapid Rewards Premier Business Credit Card
- Southwest Performance Business Credit Card
Southwest has three personal cards and a business card. Each of these cards offers rewards between 30K-80K points. In the past, people could open two cards and get a bonus that granted enough points to almost meet the minimum. However, with new restrictions on personal cards, you can only get one bonus every 24 months. Boo!
However, this doesn’t apply to business cards. If you’re eligible, have good credit, and not likely to spiral into insane credit card debt, you can open a business card and a personal card, and accrue 100K+ points. The Rapid Rewards Priority Credit Card will get you points after you spend money in no time.
Now to earn the rest of them.
The secret to gaining these credit card points is to plan your card sign-ups around big purchases. Just before a recent move, I opened a card . . . and the rewards came rolling in — a small balm to ease the pain of how exorbitant moving can be.
Put everyday spend — especially big purchases or bulk items — on your Southwest credit card and watch your award points quickly add up. Typically, you earn 1 point per $1 spent on your Southwest card and 2 points per $1 on actual Southwest purchases.
But there are other ways to earn points, including:
- Flying Southwest: Booking travel on Southwest earns more points. The cost of this travel will be worth it with your companion pass
- Shopping from Rapid Rewards Partners: Purchases with Southwest’s “Home & Lifestyle” and “Shop and Dine” Partners also earn Companion Pass qualifying points. While you shouldn’t make gratuitous purchases, browse Southwest’s partners to see if you could earn extra points for items you'd be purchasing anyway. All this, simply from enrolling in their Dining Program and shopping with their partners.
So there you have it! And since it’s almost Spring, get to earning and soon you’ll be flying two for the price of one!