Money Management Habits You Can Learn from Each Generation

Did your grandparents save everything? Did your aunt give you a savings bond each year for your birthday? Do you have a cousin who uses an app to transfer money when it’s time to pay rent? Does your niece seem to have a bunch of side hustles? 

Every generation has unique money management skills, and there’s valuable advice you can learn from each one’s saving, earning and spending habits. Whether it’s living below your means, planning for retirement or thinking outside the box, here’s some money management tips you can learn from every generation.  

The Greatest Generation: Thrift 

People who were born between 1901 and 1924, sometimes dubbed the Greatest Generation, often lived through times of hardship and deprivation, whether due to wars or the Great Depression. From this, they’ve learned the skill of thrift. They’re typically cautious with their spending habits, often balancing their checkbooks daily and never buying a new appliance or car if the old one could be fixed. They know how to mend a tear, upcycle an old jar and find a great deal wherever they look. 

Most of us could learn from this frugality. There are almost always ways to cut back on personal spending habits, from making coffee at home and bringing it with you to carpooling to save on gas to figuring out how to swap in a cheaper “dupe” for that more expensive item hawked by an influencer online. Take that extra cash and store it away. It’ll give you peace of mind knowing you have an emergency savings. 

Baby Boomers: Plan for Retirement

Most baby boomers, people born between 1946 and 1964, are well acquainted with thinking about retirement by now. But most of them have also planned ahead. While the rising cost of living has kept many baby boomers in the workforce past when they expected to retire, they also tend to have contributed to their workplace retirement plans, like 401(k)s, for most of their working years, meaning they’ve built up savings and investments for decades that they can draw on. 

The money habit takeaway? Keep saving for retirement! The younger you are, the more time you have for your contributions to accrue, which means more money for when you retire.

Generation X: Talk About Money 

For a long time, talking about money was considered impolite. If you talked about money, you were being rude. Generation X, people born between 1961 and 1981, are twice as likely than older generations to have regular conversations about money and finances. That means they’re sharing information and goals, which destigmatizes challenges and spreads knowledge around, too. 

What money habits can you learn from Gen X? Be open about money and do your homework. Research different financial services options and talk to your peers. Make sure you understand everything you can about fees and your financial goals. By keeping yourself informed, you’ll be able to take charge of your financial future. And if you need help, Farm Bureau is here to provide financial planning services.  

Millennials: Choose Debit Over Credit 

Having lived through recessions, burst bubbles and market downturns, as well as experiencing the effects of student loan debt, millennials, people born between 1980 and 1996, tend to be much more suspicious of credit card debt than previous generations. Millennials have fewer credit cards than their older peers, and they tend to have good credit scores as well. 

The takeaway? Be wary of debt. Even though using a credit card is an important way to build credit, it’s essential to be aware of your spending habits and the hidden fees some cards can bring. Paying your balance monthly is great step toward building your credit score without getting into financial trouble. 

Gen Z: Diversify Your Income Streams 

Gen Z, born between 1997 and 2012, are the newest players in financial markets. They’re entering an uncertain economy where the rules often don’t match those of older generations. College degrees don’t guarantee a job anymore, the job market has been especially challenging in the years since the pandemic, and new developments like cryptocurrency and generative AI have made the future uncertain. 

For many, the solution has been to diversify income streams by putting together a “portfolio career” consisting of jobs, side gigs and passion projects. 46% of Gen Z workers in the U.S. are participating in the gig economy, compared to 37% of millennials. 

There’s a lesson here: In times of uncertainty, thinking about different ways to cover bills and provide for yourself and your family is wise. And of course, having insurance to provide for the unexpected can go a long way.  

Reach Your Money Management Goals No Matter Your Generation 

Need extra guidance to reach your financial goals? Whatever generation you belong to, Farm Bureau can help. Reach out to Farm Bureau today.