Millennials have a complicated relationship with money. This generation came of age during the Great Recession of 2008, often witnessing their parents’ retirement savings evaporate practically overnight. Many graduate with crushing student loan debt and famously live with their parents post-graduation. Despite this, millennials set lofty financial goals for themselves and have adopted smart saving habits.
In short, millennials have picked up valuable money habits — ones that might prove helpful to the generations that came before.
1. Adopt New Saving Habits
One useful millennial saving habit is comparison shopping. Millennials are very price-conscious and will put in the upfront work to find the best deal possible. In fact, 57 percent of millennials admit to comparing prices online while shopping in person at brick-and-mortar stores. An even greater 90 percent use coupons to earn the best deals on purchases. They may not be clipping coupons from the local paper, but they are taking advantage of deals in digital form. A few millennial-favored apps that can yield big savings are SnipSnap, Honey, Checkout51 and GroceryiQ.
2. Spend on Experiences
Consistently labeled materialistic, millennials are anything but. Rather than buying things, many millennials prefer to spend money on experiences — travel, concerts and movie tickets. And unlike the money habits linked with the generations before them, millennials are less likely to finance their vacations using credit cards. They save up between trips, and look for ways to cut costs when traveling, such as booking lodging via AirBnB instead of at a resort or hotel.
3. Be Proactive About Investing
The majority of millennials believe that a 401(k) is a sound way to save for retirement, and thus take advantage of employer-matching resources. By investing early and often, millennials have the opportunity to compound interest over time. And they’re more actively involved in the process. In fact, 68 percent of millennials say they feel in control of their financial life.
4. Take Small Steps to Build Wealth
Millennials understand that you no longer need to save up a big chunk of change to start investing. With apps like Stash and Acorn, investors can start with as little as $5 and build wealth over time. Users can set investing goals and monitor stock performance right from the app. Anytime they make a smart financial decision (like foregoing the coffee shop and brewing at home), they can invest those savings directly into their portfolio.
Start Better Saving Habits Today
Millennials are changing the way we think about money — from saving and investing to using technology to make financial planning a cinch. Set up an appointment with a Farm Bureau Wealth Management advisor, who can help ensure you are on the right path to a secure future.