A generation ago, parents balanced a checkbook, saved for a house and contributed to their company 401k. Today, millennial parents know how to make deposits and transfer money with a few taps of a smartphone but there’s still something to be said for the old cash-stashing ways of previous generations. We asked millennial parents what methods they use—technology and otherwise—to help them save for their family’s future. Here’s their best six tips.
TIP #1: MEAL PLAN
A little planning goes a long way to creating healthy meals that last longer than one day. New mom and editor, Emily, 28, tells us that she meal plans on Sundays, and purposefully makes meals that’ll produce leftovers so she’ll have extra to bring for lunch the following week.
She adds, “With a six-month-old at home, eating out is no longer a priority so we have most of our meals at home. We’ve been testing out dinner kits and found one that costs $23 per meal. While it’s not the cheapest option, once you factor in the convenience (you don’t have to look for parking or wake the baby from his nap to grocery shop), it’s well worth it.”
TIP #2: SUBSCRIBE & SAVE
With the arrival of a new baby every priority shifts, especially when it comes to spending. Attorney and mom of 1, Julia, tells us that what she used to splurge on for herself (think: mani/pedi outings or weekends to wine country) is now funneled to what her now 1 ½-year-old son needs. She finds that Amazon’s subscribe and save ends up helping her family save every month on staples like diapers, wipes and laundry detergent.
An added tip from Julia, “If you have the storage space, buy in bulk, which is often more affordable than heading to your local grocery store every time you need a household product.”
TIP #3: USE TECHNOLOGY TO YOUR ADVANTAGE
Beyond apps like Venmo that make quick pay easy, Sophia, 29 and due with her first baby in February, divulges that she uses the free app Qapital, which motivates you to save money. She says, “You can set it to help you save in small or large amounts and you ‘reward’ yourself for hitting goals. For example, the app is linked to my FitBit and when I hit my stepping goals it saves $2.00. Or every time I use my debit card Qapital will round that transaction to the dollar and save that amount. Its pretty amazing!”
Another favorite is Mint, which is a free app you can use to track your spending. Link it to your bank account and Mint will help you manage your bills (hey, no more late fees!) and budget for your future.
TIP #4: GET CREATIVE
Saving doesn’t have to be so dry and boring. Jessica and her husband Simon decided to create a swear jar when their son was born. Every time one of them swears in front of their toddler son, they put $1 into the jar. Each month they take that savings and put it towards their son’s college savings fund. Over the past three years, they have put over $700 in their T. Rowe Price 529 plan, with earnings compounding for the next 15 years until their son leaves for college.
TIP #5: DECIDE WHAT TO SPLURGE ON
As a new parent, your spending priorities inevitably shift, but many millennials we spoke to tell us that it’s important to treat yourself to something that you really want or will really use. With two little girls at home, Kristin, 31, tells us, “One thing that we didn’t give up was our cable. We decided that with two small children and very little social life that didn’t revolve around toddlers, we wanted a way to treat ourselves once the kids went to bed.”
Can’t decide whether to purchase or not? Kristin has a great suggestion: a 24-hour rule. Simply ask yourself again in 24 hours if you still want the item. If so, go back and buy it and if not, it’s something you saved money on (and you probably didn’t really want or need in the first place).
TIP #6 USE TIME TO YOUR ADVANTAGE
A generation ago, parents didn’t have 529 Savings Plans, as the tax-advantaged investment vehicles were first introduced in 1996. College may seem far away when you have a newborn or toddler, but opening a 529 Savings Plan today can put the power of time, and earnings potential, on your side. Compounding returns can help your investments grow exponentially over time. The sooner you get started, the longer your savings has to grow.
Bonus: Friends and family can also contribute to your child’s 529 plan. Ask grandma and grandpa to skip the battery operated toys and gift directly to your kids online with T. Rowe Price’s GoTuitionSM gifting portal or by sending in a Gift Contribution Slip. Find out more about 529 Plans here.
Tell us: how does your family save and budget? What are your tips? Sound off in the comment section below!
A T. Rowe Price 529 plan can help you reach your college savings goals while offering tax savings options. Your investment can be used tax-free to cover tuition, room and board, books, supplies, computer technology, and equipment related to attending a qualified education institution. Find out more.