Millennials, Money, and Chasing the Middle-Class Dream
When it comes to Millennials and their finances, a lot of media coverage would have you believe that frivolous spending is all you need to know about. One less avocado toast or hipster coffee here and there and all that student debt would be gone. Or, for a lucky few, perhaps your inheritance will bail you out down the road (if it isn’t bailing you out already)—because there is going to be a massive wave of inheritance. The biggest wealth transfer in history is already underway, with Canadian Millennials expected to inherit about $1T in wealth from their parents, the Boomers, in the next 5 years. In the US, estimates range from $30T to over $60T over the coming decade. In the UK, it’s about £1T by 2027.
What gets lost when we get caught up in the memes of frivolous spending is that Millennials are living a very different financial reality than the Gen Xers and Boomers that preceded them. Millennials have different financial priorities, different needs, and different expectations. That’s true of Millennials who are struggling to afford the cost of living anywhere but their parents’ basement, and it’s true of the Millennials who are earning seven (or more) figures annually.
Caught between the far-too-reductive view of impoverished Millennials as they are now, and the not-yet-visible contour of rich Millennials as they later will be, the financial sector is struggling to find an effective way to serve this cohort. That’s why TDL undertook a research project to map out the values and priorities of Millennials. You can read the report here, and TDL would like to acknowledge the generous support of the FP Canada Research Foundation. Assembling a more nuanced portrait of this generation, and developing some practical recommendations for financial institutions and fintechs to provide better service to Millennials, contributes to TDL’s mandate of promoting better outcomes for all members of society.
Want to learn more? Hear Dr. Brooke Struck discuss the research live with practicing financial planners at Financial Planning Week 2021.
About the Author
Dr. Brooke Struck
Dr. Brooke Struck is the Research Director at The Decision Lab. He is an internationally recognized voice in applied behavioural science, representing TDL’s work in outlets such as Forbes, Vox, Huffington Post and Bloomberg, as well as Canadian venues such as the Globe & Mail, CBC and Global Media. Dr. Struck hosts TDL’s podcast “The Decision Corner” and speaks regularly to practicing professionals in industries from finance to health & wellbeing to tech & AI.
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