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10 Things Millennials Should Consider Before Giving Apple $1000 For A New iPhone X

10 Things Millennials Should Consider Before Giving Apple $1000 For A New iPhone X

Apple fans are super optimistic about getting the new iPhone X.
Before you fork over $1000 for the luxury phone, budget-minded millennials should consider the following priorities which should come before a luxury phone.

Verizon, Sprint, and T Mobile have partnered with Apple to pull off one of the best schemes ever, allowing millennials to finance their phone. Apple keeps getting richer with overpriced phones made in factories in China and millennials stay broke by spending money based on their wants vs needs.

1. Savings Account

First question, do you have money saved up for a rainy day or if some unforeseen event happens? If the answer is no, you should not get a new iPhone X. You don’t want to be that girl or guy who is flossin’ an iPhone X but needs to borrow money from friends and family for food, car payment, or other items once you run into a financial challenge.

You could open a savings account with American Express at 1.15 percent annual percentage yield (APY).

2. Do you lease or finance your car with a high-interest rate?

A $1,000 could go a long way toward buying a reliable used car or putting yourself in a position to eliminate car payments by owning a reliable new car. Contrary to popular opinion, one study found most millionaires buy used cars, at least 2 years old, as this is when the depreciation of the car starts to slow down. Eliminating monthly car payments is winning strategy for savvy millennials who want to keep, save, and invest as much cash as possible from their hard work.


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US News compiled a report of the best-used cars to buy for less than  $5,000.

3. Pay down your student loan

Student loan defaults hit a record high in 2016. More than 40 percent of college graduates are not paying down their student debt. Most of those are allowing the interest to accumulate. More than 1.1 million Americans defaulted on their federal student loans last year. No one would tell you are irresponsible if you chose to pay down your student debt or get caught up on your student loan payments with the $1,000 you would use for a new iPhone X.

iphone price

4. Start a home ownership fund targeting 3% down

Wells Fargo launched a homeownership program with a 3 percent down payment. In many states, this puts home ownership within range for many millennials who would buy a $1,000 iPhone X.

5.  Clean up your credit and pay down credit card debt

Do you have a relatively low credit score and too much credit card debt? You can consider trying to clean up your credit by paying down debt or resolving old debt weighing on your credit score.  Credit card companies are charging up to 20-to-30 percent on the debt in many cases. So it will actually cost you more than $1,000 to buy your new luxury phone when you factor in the opportunity cost of not paying down expensive consumer debt. You could discipline yourself and say you won’t upgrade your phone until you achieve a 680-to-700 credit score.

6. Make sure you have adequate healthcare coverage

Some people think they are saving money by having no or cheap health care coverage. Your health is your responsibility, not your employer’s. No one is going to look after your health and wellbeing as good as you can. Many millennials get into a penny-wise-pound-foolish trap of going with no or weak coverage. They think they are saving money. What ends up happening is you run into a health problem while being underinsured and it ends up costing you more. Additionally, preventive care can go a long way to supporting your health and well-being. Many millennials have started accumulating medical debt while having luxury iPhones.

iphone price

 7. Do you have life insurance?

If something was to happen to you, would you want to burden your family and put them into crushing debt? You can get life insurance with as little as $15 a month. Protective Life Corp listed five reasons millennials should consider life insurance:

  1. People depend on you. Even if you don’t have children, you probably have dependents. You might have a spouse, or a long term significant other who you share assets with. How would their lives be affected if you and your income were suddenly out of the picture? Would they be able to afford to live comfortably? Could they even afford to take the necessary time off to mourn properly, or would the threat of immediate financial duress simply add to their stress?
  2. It’s more affordable when you’re young and healthy. Every insurance company understands risk. A healthy millennial is generally considered to be a low-risk client for a life insurance company, therefore, you are more likely to get an affordable life insurance policy. If you are a non-smoker with few or no pre-existing conditions, you might be surprised to find how inexpensive a life insurance policy can be.
  3. Consider your cosigners. If you were to die unexpectedly, there are certain types of debt that are waived such as student loans. However, if your parents cosigned on a student loan, car loan, or a credit card that was also in your name, they’ll still be on the hook for those debts even after you’re gone. If your parents racked up a considerable amount of debt to send you to school, the thoughtful thing to do would be to name one or both of them as beneficiaries on your life insurance policy.
  4. Don’t leave your loved ones on the hook for funeral expenses. Even if you leave no dependents and no lingering debts, someone will have to cover the costs of providing you with a proper burial and/or funeral. Funerals can cost your loved ones anywhere from $5,000-to -$15,000, and the simplest of life insurance policies can prevent you from burdening your friends or family with that expense. If you have thoughts about how you’d like to be buried or commemorated, it’s important to leave such instructions in a legally binding last will and testament.
  5. You may need to supplement the insurance provided by your employer. If you were lucky enough to land a good job with a great benefits package, you may already have a basic employer-sponsored group life insurance benefit plan. But is it enough? A simple policy that covers end-of-life and funeral expenses may seem like enough to a single individual, but consider the aforementioned factors and decide if you and your dependents could benefit from additional coverage. Check with your human resources department to see how much life insurance (and what type of life insurance) you have as part of your benefits package.

8. Investment and retirement

Those who invested $1,000 in Amazon’s stock 20 years ago would have over $638,000 now. Companies such as Robinhood, SoFi and Betterment are aggressively targeting millennials to open up investment accounts. For example, Robinhood has commission-free investment accounts. If your wallet is big enough for a luxury iPhone, it is big enough to open up an investment account with $500.  You could also consider opening up or adding to an existing retirement account.

9.  Invest in continuing education

Is there a continuing education program within your industry that would improve your skills and make you more marketable? This could bump your earnings potential. With $1000 you could reserve your seat and take care of your down payment for coding boot camp at Coding Dojo, which has schools in Silicon Valley, Seattle, Los Angeles, Dallas, Washington, D.C., Chicago, and Tulsa.