If you’re between the ages of 21–34 (or around those ages), you’re a part of the U.S. population known as the millennials. This unique group of adults—and the biggest generation in history—is poised to reshape the economic picture in America and the world at large. Why? Because technology is their native language. They use devices to buy and sell. They have information at their fingertips and can look at prices, reviews, and even a company’s reputation in the store before making a purchase.(1)

So what is the financial situation for this newest generation of adults—and the rest of us, too?

Six Unique Factors Shaping Millennials’ Financial Outlook

This generation is unique—and I’m not just talking about tattoos, social awareness, and specialty drinks. These adults are facing a distinct set of factors that are shaping their financial picture now and in the future.

1. Job Changes. Millennials are two times more likely to leave their current jobs after two years compared to Generation X. Over 40% of them say they’re likely to leave.(The reasons vary, including career advancement, but the change does affect wealth-building initially. Many companies reward their employees who stay longer. Moving from job to job often doesn’t give you the opportunity to take advantage of those bonuses, profit-sharing pools, and pay raises that come with a job well-done over the long haul.

2.Debt. In a survey commissioned by Ramsey Solutions, millennials reported an average of $30,580 in debt, even though their average household income is $55,200. They’re starting out in the red and many of them don’t think they’ll ever be able to become millionaires. They also admit that their debt keeps them from being able to buy the things they want or need.(3)

3. FOMO and YOLO. That’s “fear of missing out” and “you only live once.” These attitudes pervading U.S. culture put pressure on millennials (and other age groups) to forego planning for the future in favor of living for the moment. Just watch a few commercials and you’ll see what I mean.I get it. Nobody wants to miss out on life’s adventures. We all dream of a trip to New Zealand or an adventure in Costa Rica. But those things come with time. The problem is that many people—from all age ranges—take those trips when they can’t afford them and put their financial security at risk in the process.

4. Lifestyle expectations. Listen up, people. When you graduate from college, you’re not supposed to be driving a fancy car or living in a condo overlooking the city. You’re not supposed to take excursion vacations or own an expensive wardrobe. The retail industry has baited our culture with lies about status and possessions, and we’ve swallowed them—hook, line and sinker.Some people compare their lifestyles to their parents’, but that’s not a fair comparison. Those parents worked a long time to reach that financial status. As a person’s career grows, so will their income, and they’ll be able to enjoy some of the perks that come with diligence and hard work.

In the early years, a person is supposed to have less money—they’re just starting out!Some people compare their own lifestyles to others’ their age, and that’s not a good barometer of financial success either. A good portion of them are up to their eyeballs in debt. The stress and anxiety they feel every month hides behind closed doors—where they worry whether they’ll be able to make ends meet!

5. Digital spending. It’s no secret that the younger you are, the more likely you are to take advantage of technology, even when it comes to spending and saving. In the U.S., people now prefer using a debit card for everyday spending, like groceries or clothes.(4) Sixty-seven percent of millennials prefer to shop online rather than in the store, and that number declines with age.(5) Add in the rising usage of smartphones for mobile payments and you’ve got the ingredients for a big problem.

Why? Because when you and I don’t fork over the cash, we’re likely to spend more. Here’s a simple example: When you only have a $10 bill in your wallet, forking over $5 for a high-priced coffee causes hesitation because you actually feel the emotion of loss when that money leaves your hand. Your body doesn’t register the same feeling when you use a debit or credit card.

6. Convenience lifestyle. A newlywed colleague mentioned in passing that her new husband wanted to learn how to cook. He had never spent time in the kitchen because it was easier to grab something from a restaurant. He is in his early 30s. Can you imagine how much money he’s forked over for a plastic fork and paper bag?

The good news: With more resources available to this generation than any other, these factors don’t have to determine the financial future of millennials. They can choose to live differently and reap the rewards of swimming upstream against the current of debt and commercialism.

What Millennials Are Doing Right About Retirement

While millennials face a number of challenges in our culture, a good number of them are thinking about the future. The Ramsey Solutions survey showed that 58% of millennials are already saving for retirement. And of those savers, about 70% of them wish they were saving more and 80% of them plan on saving more later. This tells me that millennials are planning for their futures, although most are still feeling the crunch of debt payments combined with the cost of living. Many younger millennials are now starting to pay for things they’ve never faced before—like housing, utilities, insurance, and even food. The credit spending I’m seeing in millennials underscores the importance of teaching kids about money long before they leave the nest. A better foundation leads to better outcomes.

One Powerful Factor That Could Change Millennials’ Future

Millennials have one advantage over every other generation, and that one factor gives millennials the greatest opportunity to build wealth. It’s not a stock tip or a technological advantage or even more education. It’s time.

Building wealth takes time, and millennials have more of it to work with between now and the time they retire. They’ve saved about as much as baby boomers (less than $10,000), but unlike boomers, millennials have the luxury of time to allow that money to grow.

For example, Mark begins putting away 15% of his $40,000 salary, or $500 a month. The chart below shows how much he’ll make by age 65 based on when he starts investing:

Began Investing                          Account at Age 65

Age 25                                                 $2.9 million

Age 35                                                 $1 million

Age 45                                                 $378,000

Age 55                                                 $105,000

Let’s look at this a different way:

Age Mark Began                             Amount Invested              Amount at Age 55

25                                                                    $500                                        $1 million

35                                                                    $1,400                                     $1 million

45                                                                    $5,000                                     $1 million

Do you see the importance of investing early? If you invest earlier, you can hit that million-dollar mark sooner. If you wait to invest, you will need to invest more each month or invest for a longer period of time. I don’t know about you, but I’d much rather start investing earlier and say goodbye to the daily grind as soon as possible. That means you need to talk with a financial advisor now, not sometime way out there in the future.

What Every Generation Has in Common


Now, listen up: It doesn’t matter if you’re a millennial, a baby boomer, or land somewhere in between. All generations share something in common when it comes to money—every person controls where their money goes. Whatever your current financial situation, you’re the only one who can make it better. You’re the one who decides where your money goes.

So right now, before today ends, set goals for where you want your finances to be in a year, five years, and even 20 years in the future. And then make concrete plans that will help you reach those goals. Step by step, work your plan and you’ll see progress. Slow and steady wins the race. Every time. Every. Time.

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