“Life is what happens to you while you’re busy making other plans” (John Lennon)
Millennials comprise 25 to 35% of SA’s population, representing various interests, backgrounds, and lifestyles. It’s also helpful to distinguish between older Millennials and younger ones. The older cohort grew up with PCs and video games, while the younger Millennials were raised on smartphones and apps.
Inside your Millennial mindset
Millennials are a values-driven generation that prioritises family, community, and creativity. As digital natives (especially the younger half of the cohort), you’ve grown up alongside rapidly evolving technology and embrace new forms of communication, enjoying how they allow you to connect with the global village. Your generation also values environmentally conscious practices, often opting for eco-friendly products and sustainable living choices.
Millennials invest heavily in human capital, prioritising education and self-improvement more than previous generations. Although many gravitate towards STEM fields — science, technology, engineering, and mathematics — there’s a growing interest in social sciences and applied arts. Millennials are also known for their willingness to take risks in the workplace. Many pursue passion-driven careers, dream jobs, and side gigs while also emphasising a healthy work-life balance.
Travel is another major priority. Millennials tend to explore the world frequently, often choosing experiences over material possessions. Unlike previous generations, they are more likely to rent than buy, finding flexibility and mobility preferable to traditional homeownership.
Millennials and money
Millennials tend to be cautious investors and are often more focused on avoiding losses than chasing gains. After seeing their parents’ or grandparents’ financial struggles, they typically save more than previous generations (some studies show they save around 18% of their income, compared to Baby Boomers’ 11%).
Many Millennials are risk averse, sometimes to their detriment, as they know about economic downturns. This conservative approach can result in missed opportunities for long-term growth through compounding and equity gains. Quick to adjust based on current data, Millennials sometimes make rapid changes that might impact their investments’ long-term potential.
Millennials use social media, financial apps, and online calculators to find investment insights. They prefer digital interactions and can make investment choices with just a few taps on a smartphone. They are known to dedicate time to tracking their investments (some up to seven hours a month) and are faithful to brands that offer seamless tech experiences. Some Millennials are “crypto-curious” or drawn to robo advisers.
Living longer, planning smarter
Humans are living longer than ever before. Already, global life expectancy stands at over 70 years for men and over 75 years for women. And these figures are expected to increase rapidly due to advancements in healthcare, nutrition, and wellness practices.
A recent study suggests the maximum human lifespan could extend to 150 over the next three centuries. This calls for investing more in equity for retirement.
Navigating your financial future with smart tools
Many Millennials find online calculators and tools valuable for guiding their financial decisions. You can find all kinds of calculators online, including:
- Retirement calculators: Estimate how much to save monthly for a comfortable retirement.
- Goal calculators: Use this tool to determine monthly contributions to achieve specific goals, such as paying for Junior’s varsity education or taking an overseas trip.
- Investment selector tools: Like Tinder for investments: match with investment options that align with your risk tolerance and timeline.
- Tax-free investment calculators: See how much tax you can save over time by investing in tax-free funds.
These tools are designed to inform and educate but don’t replace professional advice. Consider them a learning resource to help you understand your financial possibilities.
The power of a personal financial guide
While relying on digital tools alone is tempting, it’s worth putting in the time to build a relationship with a trusted financial advisor. Digital tools and robo-advisors lack the personal context essential for complex financial decisions.
A good advisor knows what makes you tick. And they can use their experience to help you ride out market fluctuations and keep your investment strategy on track for the long haul.
By all means, use those apps and calculators for quick insights – but remember that nothing beats the human touch. Investing doesn’t have to be intimidating. Take it one step at a time, leverage the resources available, and consider the balance that best suits your values and goals.
Contact us if you’d like to discuss any aspect of this article. And please feel free to share it with any Millennials in your circle.
Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice.
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