“Can you pay my bills/ Can you pay my telephone bills/ Can you pay my automo-bills?”
Oh, Destiny’s Child. Your song rings ever true — because we millennials are still spending most of our money on bills: groceries, gas, and the like, according to a recent Bankrate survey.
And although even Beyoncé herself can’t change that, one strategy that could help is also one many millennials overlook: paying with a credit card.
Revealing millennials’ spending habits
According to Bankrate’s survey of 1,002 adults, millennials’ spending habits show they spend more than other generations on groceries, gas, restaurants, and cell phones.
The only categories in which they spend less? Television and travel.
Not only that, but the amount they spend in certain categories is nutty. Take groceries, for example: $9,568 per year, or nearly $800 per month!
That might sound surprising, but don’t forget many millennials are now parents — which means more mouths to feed.
“Because I have three kids I always surprise myself every week at how much I spend on groceries,” 35-year-old Joanna Horowitz told Bankrate. “It just never seems like we have enough food. I have to go to the store at least two or three times a week.”
If you’re spending crazy amounts on your bills, then the obvious solution is to cut back where you can. But at the end of the day, there’s only so much fat you can trim. So if you’re going to spend that money, you might want to consider paying with a credit card.
Should you pay with a credit card?
Writer Dana Sitar is one of the many millennials who’s chosen not to have a credit card.
“I’m not sure I trust myself to use it responsibly,” she explained. “I’d guess other millennials feel the same, because we’ve seen people go so deep into debt from spending beyond their means.”
Those are legitimate concerns, and if you won’t be able to use a credit card responsibly, then it’s probably best not to get one.
But if you’ve only avoided credit cards because you don’t want to pay interest, it’s important to realize it doesn’t have to be that way.
Instead of keeping a tab and racking up interest charges, use your credit card like a debit card, and pay your bill in full each month. When used like that, credit cards can be a powerful tool in your financial arsenal.
Want proof? Let’s say you’re like the average millennial surveyed, who spends $9,568 on groceries and $3,048 on gas each year.
If you signed up for the American Express Blue Cash Preferred, you’d get 3 percent cash back on gas and 6 percent on up to $6,000 of groceries.
Combine that with the 1 percent cash back you’d get on all other purchases, and at the end of the year, you’d have an extra $527.
How nice would that be? Even better, if you invested that money annually, it could grow into big bucks by the time you retire.
Or, you could put your purchases on a travel rewards card. If you have good credit, the Chase Sapphire Reserve is the cream of the crop; you’ll get three points for every dollar you spend on travel or dining. Points that could be used to finally take that dream vacation to the likes of Italy or Bali.
You see? If you pay with a credit card and then pay it in full each month, you’ll benefit from the money you’re already spending.
Just spend responsibly, and your finances might eventually shine so much that even Queen Bey would be proud.
Interested in a personal loan?Here are the top personal loan lenders of 2018!
|Lender||Rates (APR)||Loan Amount|
|1 Includes AutoPay discount. Important Disclosures for SoFi.
2 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|7.39% - 29.99%||$1,000 - $50,000|
|4.98% - 14.24%1||$5,000 - $100,000|
|8.00% - 25.00%||$5,000 - $35,000|
|5.99% - 16.24%2||$5,000 - $50,000||Visit Citizens|
|5.99% - 35.89%||$1,000 - $40,000||Visit LendingClub|
|5.25% - 14.24%||$2,000 - $50,000||Visit Earnest|
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