If you know me, you know how much I value the mentorship of those from younger generations. It opens my mind and has proven over and over to advance me in my path to success. My reason for having younger (and older) mentors is to understand those who grew up in a culture different than I. In this way, I can understand their specific struggles, characteristics, and how they are changing the world.
One way, in particular, that twenty-somethings are set apart from other generations is how they save money. From our conversations, I’ve gained the following insights on our money-saving differences.
Millennials Must Save More.
Millennials will need to save more than Boomers did, in order to have a comfortable retirement. Predictions show that the changing demographic is likely to slow down growth and generate lower returns, as well as the amount of student debt that weighs on them financially.
Priorities are different for saving between Millennials and other generations. Boomers saved to be able to leave the workplace (retire), while Millennials are more apt to save to live their desired lifestyle (a vacation, health and wellness, dining in nice places). Millennials think in terms of their life in the next 10 years, and that is not the mindset of most previous generations.
Millennials Must Be More Cost Aware.
Those in the Millennial generation have to be more cost-conscious; 71% have student loans averaging $31,000, and they are more likely to live in a high-cost urban area than in previous generations. Because of their understanding of technology, they are also more likely to use apps like Robinhood, Couchsurfing, Acorn and Mint in order to be disciplined savers.
Millennials Strategize to Save.
For Millennials, there are a number of cost-saving strategies and savings strategies to employ. Three of the most effective strategies are: Get a roommate; take advantage of any savings plan that your employer has to the maximum you can afford; or get a side gig, or “side-hustle,” as they’re called. These strategies will create a nest egg as fast as almost any, other than winning the lottery.
The truth is, though, we can all adopt savings strategies from each other, because we all could use a little more cash.