A round-up of the best millennial finance stories of the past fortnight. Find out why millennials are the best financial planners of any generation and how millennial men and women differ in their approach to investing. Plus, is employing a cleaner the reason why London-based millennials can’t get on the property ladder?
As new research by Charles Schwab reveals that millennials are the best financial planners of any generation, with 31% reporting having a financial plan, this article looks at best practice that other investors can learn from them. These tips include not being afraid to ask questions, using debit rather than credit cards to help them stay in control of finances and not getting distracted by what others are doing. Not being overconfident is also an essential attribute – for millennials, this comes naturally, as their early working years spent in the shadow of the financial crisis means they are accustomed to factoring in negative events.
A report by PNC Investments’ 2018 Millennials & Investing survey further highlights how different millennial men and women’s investing styles are. The study suggests that millennial men are happy to take risks such as by investing in crypto-currencies, and are likely to glean their financial knowledge from the media. Millennial women, on the other hand, are likely to turn to family members and employers for help. This is thought to be due, at least in part, to the distinct social conditioning each received growing up: women were drilled in saving money and taking a more conservative approach to money, while men were shown how to grow their wealth.
This piece in the Evening Standard suggests another reason why millennials are failing to get on the housing ladder: they are hiring cleaners. It reports that up to 16% of London-based millennials employ a cleaner, compared with 9% across other age groups. Whether or not it’s accurate that it’s money that would be more usefully saved, it’s created some controversy.
One social media user points out that when a cleaner costs around £12.50 an hour on average, while the average deposit takes around 35 years to save up for, it’s hardly surprising that millennials are prepared to prioritise making the cramped living spaces they are set to be stuck in for years more homely.
Despite being the most indebted generation in modern history, millennials are very optimistic about when they expect to retire. A TD Ameritrade survey found that millennials expect to retire, on average, at age 56 – and 53% expect to become millionaires at some point (although men are twice as likely as women to believe the latter). While this age group is saving for retirement, it’s far from clear whether they are saving enough to achieve these ambitious targets.
This piece in the FT suggests that older millennials are less likely to be entrepreneurs than younger ones. It cites statistics from the US Census Bureau which found numbers of young entrepreneurs declined sharply at the onset of the financial crisis in 2008 and have yet to recover to their pre-crisis levels. But there are a growing number of entrepreneurs among millennials aged up to 25 – this is thought to be because this age group is more willing to embrace failure.
Millennials are opting to drink at home more and more frequently, according to a new study by Mintel. The key reason cited is that it takes too much effort to go out and drink – and this further underpins the ‘do it at home’ culture this age group favours, whether that’s ordering shopping online or getting Deliveroos in. However, there’s also no getting away from the fact that for cash-strapped millennials, it’s less expensive to drink at home than to venture out.