Why do Millennials struggle with Financial Planning and Savings?
Without a doubt; millennials are among the most talked about demographics in living memory. Representing an entire generation of adults who have been born into the digital age, they appear to have access to huge technological advantages and a freedom of movement that their forefathers fought so valiantly for.
Despite this, millennials have continued to struggle over the course of the last decade. Much of this is down to a changeable and volatile economic climate, which is constantly disrupted by scandal, debate and rising geopolitical tensions. Given these factors and the impact of the great recession, it is little wonder that millennials have struggled to save and plan for their financial future.
What are the key factors obstructing Millennials?
In order to understand the challenges facing millennials, you need only look at the current economic state and how this has changed over the course of the last decade or so. In the property market, for example, prices boomed in 2006 as credit became widely available and house prices soared. Such irresponsible borrowing triggered the subprime mortgage collapse and the great recession, however, leaving the market bereft of value or any appeal to the typical millennial.
Since then, we have the market rebound and prices increase at a disproportionate rate to earnings, once again placing the dream of home-ownership beyond the means of most millennials.
Such economic extremes have pulled millennials from pillar to post, leaving them either unable or unwilling to buy a home at various points in time. Bearing in mind that this demographic are unlikely to have significant savings or other assets and must continue to cope with a rising cost of living that constantly outstrips earnings growth, it is little wonder that more than 30% of millennials now live at home with their parents (this figures was estimated at around 25% back in 2014).
The loss of Hope and Trust: Is there a way back for Millennials?
The decision of so many millennials to return home embodies the sense of hopelessness and cynicism that weighs heavily on their shoulders. With studies suggesting that millennials would rather spend their disposable income on a holiday than building their savings, there is a growing sense that the UK’s most discussed demographic have lost trust in their economy and its ability to provide them with a viable future.
This demands a change in outlook from millennials, however, who must accept the economic and social circumstances that are beyond their control and instead assume responsibility for their own careers, savings and financial planning. Financial advice can prove invaluable, but the key is for millennials to develop a more positive outlook and take proactive steps towards securing the best possible fiscal future for them and their loved ones.