Does it seem like your Boomer parents were never broke? For many Millennials and Gen Zs, it may seem impossible to get out of debt and grow your wealth. So, what financial secrets do Boomers live by? Here are 6 reasons Baby Boomers were never broke and how you can follow in their footsteps.
1. They Budgeted and Lived Within Their Means
Today, many younger generations give in to impulse spending and FOMO. Baby Boomers are well aware of their finances. In most cases, they don’t exceed their budgets or buy things they can’t afford. For example, if Boomers decide to take a vacation, they are very price-conscience and look for the best deals. When it comes to other purchases, they usually focus on needs over wants.
2. They Prioritized Big Purchases
Baby Boomers meticulously saved for larger purchases like homes and cars. They worked hard to pay off their mortgages and debts. Just because they tend to have a higher disposable income, they are still very value-driven in their spending and are more likely to make big purchases if they get a good deal. In contrast, many younger generations are quick to pay full price for bigger purchases, especially as the housing market has become more competitive.
3. They Stretched Every Dollar
Boomers are experts when it comes to money-saving hacks and cutting costs. They understand that you may need to buy things that are quality over quantity. For example, they don’t buy fast fashion the way younger generations do. They are more likely to cook at home than young people, and they often carry cash for purchases instead of using credit cards.
4. They Valued Their Money
Baby Boomers value things like how much money they have saved, and their self-sufficiency. They can be very prideful and don’t accept help or handouts. By having this mindset, they make sure that every dollar they earn is working for them by investing or growing their savings. For example, Baby Boomers have the largest percentage of their wealth in stocks and mutual funds. According to Federal Reserve data, about 28% of their wealth is in this category.
5. They Stayed in Their Jobs
Boomers are known for staying in their jobs. According to Fortune, a new poll says more than 40% of America’s baby boomers stayed with their employer for more than 20 years. This loyalty has paid off for many Boomers. Unsurprisingly, the driving factors are often tenures and traditional pensions. While many younger generations aren’t offered this opportunity for their retirement, Millennials and Gen Z can take a page out of Boomer’s book when it comes to job loyalty.
6. They Didn’t Spend More as Their Income Increased
Lifestyle creep is often a huge problem for younger generations. As their income increases over time, they usually continue to spend more and increase their budgets. One of the many reasons that Boomers are not broke is because they are traditionally more conservative with their money and frugal.
Source: Beating Broke / Digpu NewsTex