Gen Xers: You Can Ditch Your Debt

Generation X is navigating a different financial world than their parents and grandparents did. They are living longer, which means they need to stash away more money, and health-care expenses are higher than ever. Gen Xers also are unlikely to have pensions, so they have to rely on 401(k) plans and other investments to fund retirement savings. They also are more likely to have student loans and credit card debt early in their careers.

The terrain seems daunting, but studies reveal that Gen Xers aren't overly pessimistic about their financial futures. No matter what generation you're in, a few smart strategies will help get you in even better shape for all the golden years ahead.

Live within your means
If there is a golden rule of financial health, it is this: Don't spend more than you earn. So don't buy more house or car than you can afford. Eat at home more often. Resist the urge to replace electronics just because newer models are out.

Take the free money
An employer match to a 401(k) contribution is free money. So set aside the minimum to get the match, and kick it up to the maximum if you can.

Build a budget
Track your spending for a month or two. It's good to know where your money is going so you see what changes are possible.

Wean yourself off credit cards
If you make the minimum payments on your credit cards, it will take years to get out of debt. Develop an aggressive plan and pay them off. Don't carry cards with you, and get in the habit of paying off balances monthly.

Establish an emergency fund
Have enough cash to cover several months of expenses. The emergency fund also eliminates the need to rely on credit cards for unexpected car repairs or other major expenses.

Save
Save while you pay down debt. Interest-bearing checking accounts, savings accounts, and employer-sponsored 401(k) programs are great places to start.

Do direct deposit
Setting up direct deposit at [name of credit union] can help you save. By having a certain amount of money automatically transferred to a savings account each payday, you won't be as tempted to spend what you should be saving.

If you need help establishing a financial plan, a representative at HUECU can help. Stop by or call today at 617-495-4460.