To those who think millennials are profligate in their spending, far too focused on immediate gratification rather than what's in their long term interests, a new survey may have them singing a different tune.
For nearly two years, Americans have been feeling more secure about their financial situation, based on monthly survey analysis conducted by money management and information resource Bankrate.com. However, it's millennials who are the most optimistic, as a larger share of 18- to 35-year-olds attested to financial wellness than their older peers, putting more of their hard-earned money away to go toward paying off debt as well as for unexpected situations where money may be needed.
Greg McBride, chief financial analyst at Bankrate, noted that given how young they are, millennials are addressing their money situation in ways that haven't been observed before, at least not to the same extent.
"Millennials have a greater inclination toward saving, for both emergencies and retirement, than we've seen from previous generations," McBride explained. "Much of this is attributable to the financial crisis and Great Recession coming during the financially formative years for many millennials."
Unemployment reached 10 percent
"The economy tanked just as millennials were graduating from college."
Often referred to as an economic meltdown, the recession was an especially rough stretch for older millennials, many of whom were graduating from college, only to enter a workforce where few employers were hiring. In 2009, for instance, the unemployment rate rose from 7.8 percent in January to a peak of 10 percent by October, according to the U.S. Department of Labor. It wasn't until two years later that the jobless rate fell below 9 percent.
Now that many millennials are gainfully employed, the experience of not having a source of income seems to have had an impact on their financial preparation. Case in point are the 35-and-unders who have made saving a top priority for 2016. Ahead of other common long-term goals, like losing weight and living a healthy lifestyle, over one-third of millennials say their No. 1 priority for this year is to accumulate more savings, according to a poll done by the American Institute of Certified Public Accountants. One of the ways they'll try to accomplish that is by being more selective with how they spend. Defined as buying $30 or more per week for items that they didn't intend to, impulse buying is something that over 55 percent of millennials plead guilty to, the survey revealed.
Most millennials get enjoyment out of saving
It's easy to say you'll save; actually doing it is another matter. Fortunately, many millennials find it to be more enjoyable than spending. Approximately two thirds of 18- to 29-year-olds say they would rather save than spend, according to a survey done by Gallup. That compares to 61 percent of 30- to 49-year-olds - Generation X - and 64 percent of baby boomers.
Good old-fashioned ingenuity and discipline may explain why a larger share of the country's millionaires are millennials. According to analysis performed by The Shullman Research Center, nearly 1 in 4 people in the United States making a seven-figure salary have yet to reach their late 30s, CNBC reported. Also, similar to the findings from the Bankrate study, millennials are also more likely to be satisfied with how they're doing economically. Nearly 85 percent said they're pleased with where they are versus two-thirds of Generation X and approximately 70 percent of baby boomers.