5 Things Millennials Should Do With Their Money Now That Trump Will Be President

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Practicing good money habits and knowing what to do with your finances is important, regardless of who the president is. Millennials can prepare for President-elect Donald Trump’s administration by establishing financial plans and determining what to do with their money.

If you need help with money management, these quick tips from financial experts can help.

Build Up Your Cash Reserves

Ryan Dossey, the co-founder of SoldFast, advises people to build up their cash reserves if they haven’t already.

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“My general advice to millennials is that they start by building six months of personal reserves that can be kept in either a savings account that is at a separate financial institution so it’s harder to access. My wife and I early on used a Betterment cash reserve account to try to at least keep pace with inflation. Currently it looks like they’re offering 4.5%.”

Pay Off Your Debt

After establishing an emergency fund, Dossey then recommends putting more effort into paying off your debt. You can use the debt snowball method, which focuses on small debt, or the debt avalanche method, which prioritizes high-interest debt. Dossey advocates for the snowball method.

“The second thing that I did after I built up my cash reserves was ‘snowball’ any credit card debt and, eventually, student loans that we had. In a nutshell, you pay off the smallest debt first and then use what was going to that to move on to the next largest debt. I’m also a big fan of maxing out your IRA during this timeframe.”

Invest In Yourself

Finally, Dossey encourages people to invest in themselves after they have paid off their debts. Developing new skills can lead to higher-paying career opportunities and gives you more options.

“We’ve personally gotten the highest return on investment by investing into ourselves. What new skill sets, certificates or degrees will help you earn more money or negotiate a raise at work? The potential ROI of taking a few college courses or interning cannot be overstated.”

Embrace a New Mentality With Your Credit Card

You don’t want to dig yourself out of debt only to fall back into bad habits. Christina Lynn, CFP, practice management consultant at Mariner Wealth Advisors, explained how credit card rewards programs can tempt people into bad financial habits and what to do about it.

“Millennials adore credit card rewards, with 1 in 4 actively strategizing to maximize points, miles and perks by juggling multiple cards. But here’s the catch: The average credit card user doesn’t exactly have the healthiest financial habits. The rewards game can quickly spiral into debt if you’re not careful. So, here’s your New Year‘s financial hack: Pay off your credit card balance every month. You’ll reap the rewards without letting interest charges eat into your hard-earned perks.”

Consider Investing In Crypto for a Unique Tax Advantage

Cryptocurrency has been gaining momentum among millennials, and that could be a good thing for long-term returns. These assets have certainly paid off, with Bitcoin comfortably outperforming the S&P 500 and Nasdaq Composite over the past five years.

While it’s important to assess your risk tolerance and financial objectives, Lynn pointed out a key tax advantage cryptocurrencies have over other assets.

“For the savvy investor, there’s a unique tax strategy worth noting. Digital assets like Bitcoin and Ether aren’t subject to the wash-sale rule, making tax loss harvesting a powerful tool. However, this strategy can be complex. Consulting a qualified financial professional familiar with digital assets can help navigate this opportunity effectively.”

With Trump bullish on crypto and discussing a Bitcoin Strategic Reserve, these assets are bound to get more attention during his second term.