By Audrey Willis
Guest Author & Millennial Digital Marketing Specialist
People often need financial advice that’s best suited to meet their needs, which differs from one generation to another. For this reason, you cannot expect millennials to consume the same financial advice as baby boomers. Times have changed, so financial institutions and experts also need to change their approaches to cater to the needs of a younger generation.
A new study conducted by Young Invincibles found that millennials are earning 20 percent less than baby boomers did at the same stage of life, despite being more educated. Though they are earning less, millennials are actually saving more than half of their income in cash, compared to older generations who only saved 23 percent in cash.
Millennials are also different in the fact that they experienced one of the worst recessions, and as a result, have become distrustful of financial institutions. They don’t use credit cards as much as their predecessors and prefer more tech-driven approaches to accessing services. In fact, a third of consumers aged between 18 to 29 years old have never had a credit card. As a result, banks are looking for more ways to serve millennials and help them reach their financial goals by building partnerships and creating online finance services.
When trying to appeal to this younger generation, it is important to keep in mind that millennials have two main financial priorities; paying off their student loans, and saving for the future. On average, they spend 43% of their income to pay down their debts and put away 38% of their income as savings for the future. Three out of five millennials would like their bank to be a financial partner as opposed to just another business profiting off of their work. This means tailoring products to meet their needs will create a more mutually beneficial relationship and help to attract more younger customers.
For more about millennial saving strategies and 10 tips for connecting with millennials, check out the infographic below created by Ohio University’s online Master of Financial Economics program.
Audrey Willis is a graduate of California Polytechnic State University, San Luis Obispo. She is currently working as a digital marketing specialist, and slowly becoming a financial economics guru.