It’s all about the money for Millennials

Famous for their instant gratification and want-it-now attitude, Millennials often get a bad rap.

But having lived through economic downturns, rising house prices, high rates of unemployment, student debt and some significant political changes, millennials are not as carefree and careless as they may seem – especially when it comes to money.

Somewhat guarded and remarkably responsible, Millennials tend to have two main financial focuses*:

Paying down debt (43%)

Saving for the future (38%) 

But they also stand at a cross road – according to a Facebook report on millennial spending, most millennials feel there is more they could be doing with their money, but many don’t know what – hence the goal of simply “saving for the future”. To add to this, half of Millennials say they have no one they trust for financial guidance.

So here lies the gap – and it’s quite a significant one for marketers within financial institutions:

Millennials have a considered financial mindset but are lacking in the skills to be able to plan their finances and are less trusting than the generations that preceded them.  

Content and social media can help millennials navigate the finance industry. Marketers within financial institutions can play a pivotal role in helping Millennials make the most of their financial mindset.

Here’s how:

Understand their transitional lifestyle

Millennials go through many significant life stages –  leaving home, travelling the world, marriage, having their first child and becoming a home owner. The challenge is to produce content that speaks to these varied life stages and to keep in mind that no year will be the same for Millennials – this will be an ever-changing transitional period with varying financial states.

Help them define personal financial success

Financial institutions would  benefit by guiding Millennials through their two main concerns (paying down debt and saving for the future) but also in helping them understand exactly what they’re saving for and the role that different forms of debt play. It also makes sense to dive into what financial success means to millennials in both the immediate and future state.

Tackle their complicated relationship with credit

Regardless of whether Millennials currently own a credit card, 25% describe credit cards as something that worsens their financial standing. And they are 1.3x more likely than Gen Xers/Boomers to feel this way*.

Additionally, 30% of Millennials say that they are not sure how credit cards could be helpful.

The anti-credit card sentiment could become an incredibly useful touchpoint for financial institutions wanting to help Millennials understand their relationship with money. There could be opportunity to focus on building credit and increasing financial flexibility.

Be their guide with a savings plan

54% of Millennials say they save simply because they want to be responsible, The second most common reason for Millennials save is simply for an emergency (20%)*.

Only 17% say the main reason they are saving is to buy a home—and retirement feels very distant at this point, with only 8% citing it as the primary reason they are saving*.

Millennials are placed between living in the now and focusing on saving for an unknown future. Providing them with information on saving plans and future financial states would help most go from ‘just because’ savers to informed managers of their money.

De-mystify investments

Millennials’ young age could be an advantage in investing, but they are actually 1.6x more likely than Gen Xers/Boomers to have no investments whatsoever—and what’s interesting is why… while distrust in financial institutions and the economy are typically blamed, only 12% of Millennials say distrust is the primary barrier. A lack of money (54%) and knowledge (24%) are the primary issues.

What Millennials really want

More than anything, Millennials want to feel understood – and this starts by understanding that they aren’t a one-size fits all generation.

Discovering what really matters to them is vital to marketers – especially because Millennials are 1.4x more likely than Gen Xers/Boomers to switch financial institutions*.

45% of Millennials say they would switch banks, credit cards or brokerage accounts if a better option came along that provided assistance to their needs. Therefore it is is more important than ever that financial institutions provide them with tools and information that truly helps them navigate their way through their financial needs.

Understand them and they may just stick around.

*https://insights.fb.com/2016/01/25/millennials-money-the-unfiltered-journey/