Alright, alright, I’ll admit it, I’m a little obsessed with Millennials. Their mind-set, their approach, their priorities – it all makes me curious about what makes them so different, compared to other generations? Millennials are also referred to as generation Y – they question the status quo – why do I have to work 40 hours a week when I can get my work done in 30?
Specifically I am interested in how they approach personal finance. I’m convinced they are truly, significantly different from previous generations. I’ve been accused of constantly throwing shade at millennials and will readily admit that some of their tendencies seem a little wonky (downright irritating actually, #YOLO – FALSE! – you live everyday, you only die once #YODO) – many are walking contradictions (aren’t we all?); having said that, today’s post isn’t about being hyper-critical of 20 and 30-somethings – we were all young and inexperienced once; besides, not all millennials are self-absorbed, think they’re entitled to a participation trophy and live in their parents basement.
I’m actually going to list the top things I have learned – and admire – about the millennial approach to finances, because truth be told, I’m a millennial wanna be – I’m just too old to be an actual member of the cool kids club. . .
Before I get to the list, let me state the obvious – these traits don’t apply to all millennials. I’m not here to stereotype everyone born from 1980 through 1995, that would be crazy; however, there are some traits that are quite common among this generation – traits that set them apart from other generations. I’m going to list the top 10 things that I admire about the millennial approach to personal finance:
1) It’s better to spend money on experiences than stuff. One survey (Harris poll) indicates that 78% of millennials would rather spend money on an experience than on a desirable good. For many, they simply don’t fall for the siren call of extreme materialism (Mcmansion, BMW, etc.). Buying possessions could drain your bank account. Experiences, this got me to thinking, what are some of my most memorable experiences?
My top 10 experiences, it was really difficult to list only 10 – I guess I’m rather nostalgic . . .
Spring training baseball with my dad and Uncle Dale, in Florida near Orlando – there’s really nothing quite like spring training baseball – a timeless American tradition
UNC basketball game with my parents, when Hansbrough broke the scoring record (Go Heels!)
Banff (Canadian rockies) – hiking with friends to a frozen lake; 83 degrees at the base, then you hit the snow-line after a 45 minute hike – amazing!
Alaskan cruise with family – spectacular views, the train, the whales, the glaciers, the rainforest, the reindeer, the smoked salmon . . .
Disney vacation (2016) with just my family; Mickey, star wars, Indiana Jones, a safari ride, Epcot, international food & wine festival – priceless memories!
Boat tour of Lake George with close friends – beautiful mountain views in upstate New York – I could easily go back every year!
Smith & Myers concert with a buddy – probably the best concert I’ve ever been to – small venue, great vocals, and some of my favorite alternative rock songs from Shinedown – including lots of covers: Phil Collins, The Eagles, Adelle, U2 – you get the picture.
Snorkeling in Georgetown (Grand Cayman) with Heather on our honeymoon; the blue water, the coral, the fish – all in crystal clear high definition!
The river walk in San Antonio with a mariachi band (with Heather) – hard to describe but its very picturesque – I love south Texas; Austin (live bands), the brisket (The Salt Lick), and of course the Alamo – Everything is bigger in Texas!
I think Millennials have a great point – I wouldn’t trade any of these memories for say a new beamer – not a chance!
What are some of your favorite memories?
2) You can save money in a sharing economy. You can rent out a room in your house (Airbnb) and possibly bank a few thousand each year to help pay part of your mortgage. Use Uber and maybe you don’t have to buy a car at all – might be workable if you live in a big city – imagine the savings of no car payment, insurance, gasoline, maintenance, etc. Social networking sites like Nextdoor.com make it easy for people to connect with others locally and share power tools or gardening equipment.
3) Technology is your friend. Cut the cord. Automate your finances. Millennials are comfortable with technology and are more willing to pay bills online and automate their savings. See my previous post on mint.com
4) Restaurants are expensive, instead, eat at home (be healthy of course). Millennials are increasingly shunning restaurants (especially chain restaurants, vs. their pre-recession levels) and why not? You can get great ideas from Pinterest and cook at home – after going to the farmers market (or ordering from Blue Apron) to get some local, ethical, fresh flavor. I believe the average restaurant meal is about $12 per person vs. $2 per person if you cook at home.
5) Earn some mad money from a side-hustle – a recent study (Bentley University) indicates that 66% of millennials want to start their own business. Maybe you want to start your own blog/podcast, provide online tutoring services, teach English remotely (via skype), be a social media/SEO consultant, pet sit, drive for Uber – there’s a lot of possibilities. . .
6) Focus on learning in your career – lifelong learning can lead to a more fulfilling and healthier life. Interconnected millennials embrace technology and prioritize happiness and learning – they believe there is a link between the two. Millennials are constantly micro-learning with so much information at their fingertips (via the inter-web). A lot of this information helps them with their career aspirations.
7) Optimistic – Millennials are persistently more optimistic than other generations – about their prospects and the future. 80% think they will be better off than their parents (USA today). See my previous post on 10 habits of happy people.
8) More comfortable talking about money – Millennials are going to talk about their salary and finances and are unimpeded if other generations are uncomfortable with these typically taboo subjects (Cashlorette survey). They are significantly more likely than other generations to discuss their salary with friends, family, even coworkers. They are revealing and transparent – maybe in an effort to make the workplace more equitable – knowledge is power – know your worth. Millennnials will use social media to ask for advice from peers – personal finance is a team sport!
9) Simplify – This generation is more actively frugal, reconsidering the role of material possessions, luxury and sustainability – probably as a result of the great recession. This new approach affects their shopping and consumption habits. Whether by necessity or by choice – minimalism is now en vogue. Basics are in – complexity and clutter are out. Recycled and vintage are chic. You have to be a minimalist to live in a tiny home. I think millennials are redefining needs and wants, in pursuit of what’s really important – functional products with a lower environmental impact.
10) Avid savers and avoid debt/credit cards – this might be a reaction to the Great recession of 2009 as well. A 2018 Bank of America survey found that 1 in 6 millennials now have $100,000 or more in savings. That’s impressive! One study (bankrate) showed that about 2 out of 3 millennials don’t have a credit card. Another study (Facebook IQ) said that 46% of millennials define financial success as being debt-free. 86% reported saving on a monthly basis!
Watch this funny video about Millennial stereotypes – it’s hilarious!