Millennials experienced the financial crisis first-hand. And many of us were unlucky enough to graduate college during the worst job market since the Great Depression.
But through these challenging experiences, we were taught a unique set of money lessons that have helped us thrive. Here are some ways millennials are getting money right:
1. We learned the importance of budgeting and saving for a rainy day.
According to a 2017 survey from Earnest, Amino and Ipsos, 71% of millennials use a budgeting tool or keep a budget (compared to 41% of Americans overall), and 68% of us can cover a $500 emergency without going into debt (compared to 43% of Americans overall).
2. We’ve taken advantage of online financial resources and education, which makes us more confident about making decisions about money.
Women ages 25-34 are more likely than their elders to report they learned about finances from one or both parents (62%, compared to 45% of older women), and over half (51%) say they are very confident in their investing skills. This final statistic is in stark contrast to their elders: Only 36% of women ages 35–49, 14% of women ages 50-69, and 11% of women ages 70-84 said they feel confident in their investing skills.
3. For the better part of our adult lives, we’ve been told not to expect all the Social Security we’re entitled to — so we’re saving more aggressively for retirement.
Although many often-cited statistics lament that we’ve accumulated less wealth than Gen Xers did at our age, this is primarily because Gen Xers were able to gain access to the housing market sooner. When you look at our liquid financial assets, in 2018, millennials held 40% of their money in retirement accounts. This is pretty impressive compared to Gen Xers, who held just 28% of their liquid assets in retirement accounts in 2002, when they were the same age (22-37).
4. Student loans have made it more difficult for us to save for a house, of course, but even that is looking more promising these days.
In the first three quarters of 2019, the largest increases in the homeownership rate came from people under the age of 35.
Continue the Discussion at one of our Conversation Circles
Millennials are being careful and responsible when it comes to money, and it’s time we challenged that popular belief that they make poor money decisions (i.e. spending it on avocado toast). If you’d like to talk more about personal finances, money messages, and generational differences when it comes to finances, consider joining us at one of our Conversation Circles.