If you think Millennials are just a bunch of spoiled spendthrifts, then think again
Every generation’s young people get a bad rap when it comes to questions of responsibility, financial or otherwise. Those who are lumped into the under-35 category today are stereotyped as spoiled, debt-dependent and — at the peril of their savings — fixated on YOLO or FOMO or whatever acronym that is synonymous with instant-gratification. However, Millennials have a lot of great things going for them. Not only do they have incredible side hustle and ambitious money goals, but their tech savvy provides incredible opportunities and choices. Here are some financial wins that we can all learn from Millennials.
They’re tech savvy
“Millennials have a lot of fabulous things going for them,” Edward Kholodenko, CEO and founder of Questrade, best known for its online trading platform. “The proliferation of technology has really allowed the Millennial generation to improve access, convenience, costs and their total experience, as they’ve grown up so comfortable being online.” Online portfolio managers or “robo-advisers” enable those with a small amount to invest — especially younger investors who’ve been neglected in the money management sphere — to access a professionally managed portfolio at a low cost, he adds. A 2013 BMO survey found that 71 per cent of Canadians under 35 use mobile banking apps, taking advantage of automated bill payments or transfers to a savings account. Also, independent financial apps can help with almost any money issue, whether it’s budgeting, paying down debt, finding deals and filing receipts.
They’re masters of the second-hand market
To fund a trip, my best friend made more than $1,500 selling things around her house on a Facebook Bidding Wars group last summer. When compared to the general population, Millennials are more likely to tap into the second-hand economy to find great deals (62 per cent versus 53 per cent) and to save extra money (66 per cent versus 59 per cent), according to new research from Kijiji. “Millennials are a generation of deal-seekers and are proud of it,” Marc-André Hade, a spokesperson for Kijiji, says. “Many turn to the second-hand economy to make their desired lifestyle more affordable.” Millennials are also more likely to see the second-hand economy as a resource to earn extra money (51 per cent compared to 39 per cent of the general population). “There are even some millennials buying items online with the express purpose of selling them online to make money. We refer to these industrious Kijiji users as ‘mini-entrepreneurs,’” Hade adds.
“If you go for it with a concerted, realistic effort, that drive and passion make up for everything,” Scott Plaskett, a certified financial planner, says. And go for it, you should, especially if you have the cushion of time: the younger you are, the more financial risks you can take because you have less to lose and more time to make up for any losses. “But stress test whatever plan you’re putting into place,” Plaskett says. For example, he adds, if you’re borrowing money, see if your plans still work if interest rates are double what they are today.
They’ve got awesome side hustle
That ambition and entrepreneurial spirit means that Millennials are busting their butts to meet money goals and fulfill passions. Forty-two percent of Millennial entrepreneurs recently surveyed for American Express Canada and Startup Canada, said they hold a second job. And with the rise of the on-demand gig economy and e-commerce, it’s never been easier to moonlight on your own terms whether you’re driving for Uber or offering on-demand childcare through DateNight, an app for babysitting services.
They actually do save money
A 2016 survey by Tangerine found that 62 per cent of those 18 to 34 have started saving for retirement and almost half said they started before the age of 25. When asked when they started saving, only 18 per cent of Canadians aged 35 to 56 reported to have started before they were 25. Finally, 42 per cent of Millennials say the best strategy for saving is to pay yourself first by setting up an automatic savings program. That’s advice we can all take to the bank.