THE BLOG
11/13/2014 11:40 am ET Updated Jan 13, 2015

Why Millennials Need to Start Investing and Why They Haven't Yet

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A recent Wells Fargo survey stated that even though 80 percent of millennials knew they should be saving money, only 55 percent were actually doing it.

So if millennials know how important saving is, what's stopping them? Apparently a lot.

In tough economic times millennials are finding that earning and investing their money is harder than they thought it would be.

Here's why.

The Great Recession

Millennials grew up during the dot com burst, the 2008 financial crisis, and the housing crash. Many millennials have seen their parents or grandparents lose all of their hard-earned retirement savings in the stock market.

After witnessing their loved ones start all over again millennials don't seem to be convinced that investing the little money they do have is the way to go.

To top it off the great recession has left good jobs hard to find. The unemployment rate is still up, especially after factoring in the long term unemployed. Recent college graduates are now competing for jobs and taking work that they're under-qualified and underpaid for.

Staggering Student Loan Debt

While the job market has went down there's one thing that has been going up over the past several years: student loan debt.

The average student graduated with $29,400 in student debt last year. From 2008-2012 student loan debt has risen by six percent each year.

With limited job opportunities and student loans that desperately need to be paid off, many millennials are having a tough time coming up with extra money in their already tight budget.

What Can Millennials Do to Protect Their Financial Future?

In uncertain economic times the best thing millennials can do is to be proactive. Those who take initiative and take charge of their own life are most likely to succeed.

Take Kali Hawlk, a 24 year old college graduate turned entrepreneur, for example. Unhappy with her low paying day job Hawlk decided to take her career into her own hands. She built a business as an online content manager that allowed her to leave the corporate life in less than a year. She documented the process on her blog, Common Sense Millennial.

When asked what she thought Millennials should do to further their careers and earn more money Hawlk's advice was simple: "Create your own opportunities. Don't wait for anyone to give you permission to try something new or different."

As far as investing is concerned, Hawlk manages to stash away 40 percent of her income by closely watching her expenses and sticking to a budget.

Millennials Should be Investing

Fear of the unknown has prevented the millennial generation from investing. This needs to change.

Investing paired with smart personal finance skills, like budgeting and tracking expenses, is the fastest way to wealth. The earlier you get started investing the better. With the power of compound interest millennials who begin investing today will have to contribute less money than their counterparts who start later in life.

With some basic understanding of how the stock market works and how investments can be diversified, millennials can gain more confidence as they make their money work for them. Taking a simple Investing 101 Class could solve those issues.

Is a Bright Financial Future Ahead?

The financial future of millennials is not doomed. In fact, today's generation has more opportunity for creating and building wealth than any generation before them.

Being able to adapt in an uncertain job market and prepare for the financial future by investing for the long term will be the key to success.

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