If you were born between 1980 and 1996, you’ll be described as a millennial. Also known as Generation Y, this largely vague demographic has been widely accused of buying too many avocados and not saving up for their future. Put simply, a stereotyped millennial is rarely out of the headlines for how they handle their finances.
We’ve done the digging to uncover the money myths and facts about how millennials are handling their money.
Myth: Millennials Are Lazy And Lack Loyalty
Many people earn extra income to help pay for everyday life, and millennials are no exception. People are making extra money by joining the side hustle economy. They can advertise a service or skill for sale on sites like Fiverr or Gumtree. Often becoming Uber drivers or Deliveroo riders. These extra jobs are sometimes undeclared, so no tax is paid for doing them.
More than one in five millennials have admitted earning extra money on the side. The most popular being creative freelance work. Perhaps this is because it is so common for them to spend their income on payday…
There is a common misconception that millennials lack loyalty, however, research has shown that they are the most brand-loyal generation! Just think, how many iPhones did you purchase so far. Yet do not be fooled, this generation is highly selective and it is hard to win their loyalty.
Myth: Money Is Status
Many millennials believe that work-life balance is more important than financial incentives. 34% would consider a managerial job unattractive as it could impede on their ‘play hard work hard’ motto.
Myth: Millennials Blow Their Money
More than two-thirds of millennials don’t have an employer-sponsored retirement plan. This worrying statistic does not however, place them in a worse position to previous generations. Unfortunately, history has shown that no generation has saved as much as it “should have”. So where do they spend their money? It’s definitely not on clothing, entertainment and cars which results in more money saved than their parents. Although seeking experiences is important to this generation, they are not as hot headed as some would like us to believe.
Truth: Millennials Love Indulgences
Artisan chocolate, coffee or fancy gin are a millennials’ essentials. Despite the fact that it is not a habit comfortable to the wallet, it is hard to criticize purchasing ethically sourced or local produce. They are also the most health conscious generation. They care more about their fitness journey than putting away pennies in their piggy bank.
Truth: It’s Time For A Break
Cheap flights make travel more accessible, and thanks to the internet new accommodation providers were added to the market. Millennials have a yearning for travel and new experiences, and a weekend in Cornwall won’t suffice. Destinations such as Bali and Thailand are increasing in popularity and are considered more attractive than saving for a house or car.
Truth: We Need More Knowledge
Generation Y is famous for their craving for education and desire for development.
They are currently on track to be the most educated generation! This does come with a cost; from expensive University fees to splurging on art classes and fitness courses. It seems that millennials’ attitude towards spending favors personal improvement over saving.
Millennials’ attitudes towards money will remain in the grey area. Despite saving on things like, housing, cars and clothes, they are spending much more in comparison to previous generation on : education, health and holidays. This generation does not normally perceive obtaining money as their priority, however the debate whether it’s better to cry in a Mercedes than on a bike will remain unresolved.