Millennials are often criticised for not being as financially savvy as ‘Generation X’ and baby boomers, but many are ahead of the game.
New research from peer-to-peer lender Archover has found that millennials – those aged between 18 and 35 – are saving as well as investing more than generation X (aged 35-54) and baby boomers (aged 54+).
Contrary to the belief that young people today are struggling to get on the housing ladder because of their lack of ability to save and their extravagant spending habits, the study found that 35% of millennials regularly save or invest an average of £250 a month, compared to 26% of gen-X and 25% of baby boomers.
In total across the 2,000 adults surveyed, 67% saw themselves primarily as savers, using banks, savings accounts and pension funds, while 33% saw themselves as investors, using riskier alternatives to increase their assets such as stocks and shares and property investment.
It seems that youngsters’ ability to embrace the latest technology could be the key to their saving and investing abilities, as the opportunities to be found using digital avenues can be wider.
According to the survey, 59% of millennials trust technology and automated services when making financial decisions, compared to 40% of gen-X and only 24% of baby boomers.
Social media also has a part to play in the uprising of technology, with millennials being more comfortable with accessing a wider range of information from their peers. The research showed that 41% of 18-35-year-olds relied on friends and family for investment advice, but gen-X (31%) and baby boomers (19%) were more reluctant to do so.
“Rather than admonishing millennials for being irresponsible, the older generations could learn something from following the behaviour of a new generation,” said Angus Dent, CEO of Archover. “Millennials, who grew up during the deepest and longest recession in recent history are proactively looking for ways to balance security and risk in order to maximise returns but without putting their capital in too much danger. In an effort to secure higher yields, they are tackling the difficult financial climate head-on.”
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