Economy for millennials: how well the "Y"generation manages finances
Generation Y or millennials are people born in 1981-1996. Every year this generation means more and more for the economy, as it gradually moves up the career ladder and takes the reins of management of companies and state institutions into its own hands.
Not so long ago, it was believed that millennials are helpless in economic terms and are more interested in concert tickets and smoothie prices. Is this statement true?
The analytical company CB Insights conducted extensive research and proved that people of the "Y" generation are not so profane in financial matters and act quite practically.
Bank of America conducted a survey that showed the main priorities of millennials in financial matters. As it turned out, 64% of them consider it important to save for unforeseen circumstances, 49% are worried about retirement savings, and 33% are raising money to buy their own home.
Oddly enough, the goals of millennials are almost the same as the goals of their parents, who belong to Generation X, born in 1961-1981. Approximately the same financial tasks were set for themselves by the "baby boomers", that is, the generation that was born in 1946-1961.
Moreover, the " Y " begin to take care of their well-being earlier and more thoroughly than the previous generations did at their age. Experts believe that socio-economic factors played a key role in this. The majority of US millennials came of age during the 2008 global economic crisis. At the same time, young people managed to get acquainted with the stagnation of wages and face student loans.
Approximately 41% of millennials took out a bank loan for education, while this figure for generation X was 26%, and for" baby boomers " it was 13% at all. In 2017, students were able to feel an annual debt load of $ 10.6 thousand, which is almost twice as much as generation X experienced in 2004.
The fate of Russian millennials is even more severe. The early representatives of this generation were caught in childhood, heavy economic reforms, default and the crisis of the 90s. The formation of" Y " coincided with the collapse of the ruble, the crisis of 2014 and the fall in household incomes, which does not stop now.
Studies have shown that in traditional banks, millennials are most disappointed by the difficulties associated with solving various problems (55% of respondents), long queues (37%) and frequent technical failures (33%). Many are also ready to refuse the services of a financial institution because of high commissions. 93% of the respondents admitted that they would like to see banking services free of charge.
But this generation is friends with digital technologies. At least 64% of "igreks" have at least one banking application installed in their smartphone. For the previous generation, this figure is 59%, and for those over 55 years old — 41%. Millennials are three times more likely than "baby boomers" to solve problems with banks through applications, and they visit bank branches 30% less often.
Millennials are more likely than other generations to think about the future and save for education, housing, retirement, just for a "rainy day". When forming their budget, they often turn to modern technologies. Among Americans aged 18 to 34, 34% use mobile applications to control income and expenses. At the same time, only 15% of US residents aged 35 to 54 trust their accounting programs.
As for savings, Generation Y prefers cash. But they like to make payments exclusively by card. For millennials, cash payments are becoming less relevant every year. 63% prefer to make transactions using a smartphone, and 41% of millennials use a mobile gadget to calculate in the store.
They are still very young, but they are already beginning to actively integrate into financial life. They are very different from millennials. 64% of "zets" study financial planning, and they begin to worry about money issues on average from the age of 13. Studies have shown that 77% of young people in Z earn money as freelancers or work on the principle of part-time employment.
Keywords: Bank | Money | Mobile applications | Youth | Pension | Finance