Millennials are seen as the generation who were born between 1981 to 1996, roughly. Technology has almost always been a part of their everyday lives and they were the first generation to have been born into the digital age. Millennials are an ambitious group of people and having been brought up in such a different environment to their grandparents, they may be approaching their finances, investments, and future retirement, a little differently to what was done in the past.
Unfortunately, according to studies, around 7 in 10 millennials have found themselves living paycheck to paycheck. This of course does not make financial independence an easy thing to carry out. Perhaps, that is why many millennials are turning to more entrepreneurial roles.
There are many new opportunities out there, with the tools readily available to anyone with access to a laptop or a mobile phone. A mobile phone that millennials check an estimated 150 times a day. This generation of people claim to be passionate about what they do and see themselves working for a very long time.
However, even if as a millennial you are planning to work throughout your entire life, it is still necessary to plan for retirement. It’s never too early to start either, as you never know what could happen in the future. Having a safety net to fall back on is extremely important. That’s why, the earlier you look to your long-term financial goals, the better returns you will see from savings and investments.
Investing like a Millennial
Social media and online resources are making it easier for this age group to learn about investments. In order to avoid similar pitfalls that older generations have faced, millennials are approaching investment in a different manner.
As the digital generation, it comes as no surprise that they are using all of this innovative technology to their advantage. These tools can do so much, from supplying stock-picking tips and market simulators to having easy access to financial planning services. With a simple tap of a screen, one can contact a wealth manager who could set them up with a life changing investment portfolio tailored to their specific desires. And all without leaving their home.
Digital currency adaptation and online rather than physical in person banking is speeding forward. There are a full range of applications available to consumers who are comfortable using these systems and they can be extremely helpful to active investors.
Some of the older end of this generation had no choice but to dip into their retirement funds when they lost their jobs during the pandemic, a marked period that caused significant impact across the world’s economy.
The younger part of this group has seen their parents and grandparents struggle with recession while the eldest have already seen two recessions in their own lifetimes – with a third potentially still threatening to come into play. With so much economic uncertainty it is wise to make a plan that accounts for a multitude of unforeseen circumstances.
Planning for the Golden Years
Although many are planning for their golden years, it might not be enough. Less employers provide a sponsored retirement plan for their workers. With the current economic climate, rates of inflation are pointing towards millennials needing a much deeper fund for their retirements than their predecessors, meaning that those going into retirement in 30 years will need to spend twice as much as current retirees do in a year.
It might look different to how their parents and grandparents went about things, but the bottom line is that millennials are starting to manage their wealth by putting financial plans into action. Some have multiple ‘side hustles’ as passive income streams to go alongside their day jobs that could help to pad out their pockets in the long term. Other millennials are planning for more short-term goals such as trips to experience each corner of the world.
Overall, there is data to show that as a generation, millennials are consciously trying to save for retirement and although they have taken a few hits from the economy, they remain hopeful about their financial futures.
If you are looking to put a plan in place for your finances so that you can meet your long-term financial goals, then contact one of our Wealth Managers today.