Millennials Are Changing the Economy With Their Money Habits

by October 10, 2018

Millennials have been developing surprisingly robust money habits, recent surveys are finding. (Photo via Pixabay.com)

Millennials, whose start in financial life was delayed—and to a substantial degree derailed—by the Great Recession, have been developing surprisingly robust money habits, recent surveys are finding.

While the Millennial taste for avocado toast and high-tech toys get all the attention, these younger workers  have also been saving and budgeting and setting important savings goals, such as buying a home.

Here’s the second story in a three-part series on Millennials. Business reporters can develop this story by looking into one or more of the following angles:

How do Millennial money habits compare with other generations?

It’s time to bust the stereotype that Millennials aren’t paying enough attention to their personal finance habits. Since 2015, Millennials have caught up with GenXers, who are a step ahead of them on the age ladder, as well as Baby Boomers in the areas of saving, budgeting, and feeling financially secure, reports Bank of America’s “Better Money Habits” Winter 2018 survey. But in one key category—setting a savings goal—Millennials trounce both generations: Over half of Millennials (57%) set a savings goal, compared with only 42% of GenXers and Boomers.

Develop this story as a graphic comparing generational money habits. Use your news media’s social media channels to engage readers from these age groups for a lively online and video discussion.

How are successful Millennials reaching their savings goals?

They’re saving more cash. Since 2015, according to the Bank of America survey, those with $15,000 or more in the bank have increased from 33% to 47%, and those with $100,000 or more have doubled, from 8% to 16%.

To reach their goal of home ownership, they’re renting and living with their parents, moving to less expensive cities, and delaying marriage and children. Data from the Federal Reserve (see Table 6) show an increase in the number of Millennial buyers purchasing their first home, from 34.7% in the fourth quarter of 2016 to 36% in the fourth quarter of 2017.

What strategies are your Millennial readers using to buy homes and meet their savings goals? Ask them to share the personal finance habits that are working for them in an online discussion. Also report your findings in print and video stories for your audience.

How can Millennials without a 401(k) save for retirement?

Four of 10 Millennial workers don’t work enough hours, or haven’t worked long enough for an employers, to be eligible for a retirement plan, according to a February 2018 survey from the National Institute on Retirement Security (NIRS), an education and research nonprofit based in Washington, D.C. That unfortunately helps explain why 66%—or two-thirds—of Millennials have nothing at all saved for retirement; when they are eligible, only slightly more than a third (34.3%) take advantage of employer-sponsored retirement plans.

But they can start saving in a traditional or Roth Individual Retirement Account (IRA). How many of your readers fit these statistics? Ask them and engage in an online and video discussion. Assemble a panel of financial experts to help, including a Certified Financial Planner (CFP).