Millennials & Money: Talking about Financial Literacy
By Carla Hindman, Director of Financial Education, Visa Canada
Millennials, also known as Generation Y, refers to people born between the years of 1980 and the early 2000s. Known as the "me, me, me" generation, millennials are the first group to grow up in the current digital era with instant access to money management tools at their fingertips. So why do they have a reputation for being financially illiterate? And what's the best way to reach them? Does it have to be done in 140 characters or less? The answer is: #Yes.
Every spring, the Federal Reserve Bank of Chicago and Visa Inc. host a Financial Literacy Summit, bringing together financial literacy experts from around the globe, with a mission to focus on strategies that will improve financial capability globally. While the experts range from senior government officials to academics and NGO representatives, the topics resonate in every community. This year's summit theme was 'Improving Millennials' Financial Literacy with Mobile Technology' – and given the number of millennials in our population, we need to pay attention to how they learn and use information if we want to impact them in a positive way.
Why aren't millennials engaged in financial literacy?
Millennials have grown up with technology at their fingertips. As the "on-the-go" generation, they rely on the fastest and most convenient way to receive information, so to reach them, you need to speak their language. This group's spending habits are based on a #YOLO (you only live once) mentality. Traditional bank statements that come in the mail a month after purchase may be left unopened, but if the same information arrives digitally, it might fit into their lives a little easier. To help improve their financial literacy, start with sharing tools that can help manage their finances, like online bill payments, cost of credit calculators, and budgeting apps. These offer an interactive way to shed some light on their money matters. Games are another great option ' with 97 per cent of millennials playing online/mobile games, mobile technology offers a great opportunity to reach gen Y.
Digital dollars are still dollars
Contrary to the boomers, millennials are very comfortable shopping online and using digital resources like banking and personal finance apps. With easy access to online spending and purchases being made at the click of a button, millennials need to recognize that digital money requires the same budgeting as cash.
What do millennials want in life? And how much money will it take to make that possible?
Remember that for millennials, #FOMO (fear of missing out) is one of the most influential drivers of spending. By helping them understand that today's spending can have an impact on their tomorrow, Gen Y-ers might be motivated to consider the importance of financial planning. With a little information and determination, they can gain the confidence needed to better assert themselves to make impactful financial decisions in the future.
Given the importance of the topic and the large number of millennials in today's population, the Summit was a great conversation starter. It's good to see so many financial tools and tactics available today that are designed to speak to millennials in a language they understand – now, we must work to keep the conversation going.
This article is intended to provide general information and should not be considered legal, tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how certain laws apply to your situation and about your individual financial situation.
References: Canada Revenue Agency