Understanding Millennials in 2016 and their Financial Habits

The following post is courtesy of Tina Roth, a personal finance blogger at ProFinanceBlog.com. Her finance blog covers advices and tips on investment, insurance, budget, personal finance and many more topic for leading a frugal life.


The millennials are 19-34 years of age. They are the target audiences for most digital marketing campaigns. Enlightened and tech-savvy, members belonging to this group don’t hesitate to swipe their debit cards in the terminal slot if a commodity attracts them.

In a time when the online retail vertical is overly focused on them, we cannot ignore them, their purchasing ability, their choice in electronic gadgets and fashion accessories. This article aims to explore millennials and how they manage their finances.


Preference for multimedia ads

Not surprising because the virtual world is bombarded with advertisements. Millennials frequent this world 24/7. Video and mobile ads are most likely to attract them. It’s not an unsubstantiated claim as there are surveys to back it. The result? Frequent usage of credit cards, and more debt, none of which is good. Besides, the big retail networks easily scoop most millennial shoppers because they can spend millions on ads, pushing the local stores to destruction.


Forget saving

Who wants to save when all voices (in and outside of your head) are insisting you to spend more money? Millennials are constantly pursued to save less and spend more. As a result, the money that makes its way into their wallets, quickly finds several leaks to ooze out.

Millennials are far from understanding the role of saving. They should because the recession wouldn’t have hit us if we have been saving money. Heaven forbids another recession, but not saving might very well lead to such a scenario.


They are irresponsible

There’s a term to sugarcoat this, which is “Delinquency.” But it’s only to make some of their behaviors acceptable, which, in reality, are not acceptable. The American Institute of CPA has recently done a study that shows millennials are late in paying out their bills. Such acts of irresponsibility hurts others around them and them the most. What follows is…


Horrible credit score

Millennials have the worst credit report. We know a credit report looks good when it has no outstanding debt, when the time gap between incurring a debt and returning it is less, when you have no outstanding dues on your credit card, etc. In short, when it shows you’ve done everything to raise your credit score. Millennials are lazy and self-absorbed (they admit this), and show no interest to work on their credit reports.


Not paying for insurance

Some of them insure their cars, but the majority are apathetic to health and disability insurance. Mortgage insurance is also not very common among them because many of them live with their parents. Experts believe this might lead to serious consequences millennials won’t remain as healthy in the future as they are now. Any accident and resulting short-term disability might require plenty of money. Not having a disability insurance may prove counter productive then.


Student loan

We cannot blame the millennials for this. Many of them took student loan, which they are still paying down. A study done by Wells Fargo Management held a heavy burden of debt to be a reason that Millennials can’t save for the retired life.

But have they been saving if the scenario was favorable for them? Doesn’t seem so because they are in…


Jobs with little motivation

Millennials report they hate their jobs. They consider 9 to 5 desk jobs as their biggest financial challenges because of the lack of financial opportunities. The result of this is the lack of professional motivation. Industry experts recommend millennials to look for jobs, which not only guarantees a decent pay, but also which render long-term growth and sustainability.

In case of a stable and secure job, the employer is bound to act responsibly and he may offer voluntary benefits and insurance options to employees. Millennials, therefore, are strongly recommended to search for such a job.


Immediate future

Millennials are not even shortsighted as they don’t even plan for the immediate future. Many millennials are not married, and many of those who are married don’t have children. Those unmarried, don’t save for their marriage. The married ones either don’t save for their offshoots or save little money.

Nearly 68% of all millennials, who were surveyed by private sources reported saving for a vacation is their priority. Saving for such flimsy purposes, and ignoring the importance of an emergency fund might cause them financial trouble in the future.


More responsibility

It’s for their own good. The average debt that each of them is $47689. Unless they make it their priority to pay down all the debt in next 2-5 years, and find new professions, which could generate money, their finances may be affected big time in the future.

30 thoughts on “Understanding Millennials in 2016 and their Financial Habits”

  1. The problem here is that we are in a world that incentivate to spend money, even the one we don’t possess.
    Loans for an iPhone 6 are the worse thing that could happen. A person barely recognizes that he’s under a huge amount of debt before she actually finds her accounts to zero at the end of the month, the day after having received her salary.
    That’s a shame, and people should be more educated about savings and how this can brighten your future.
    luca recently posted…Snapshot – ADMMy Profile

    • Hi luca,

      There’s no question that as a western culture we live in a very consumer driven society. It’s all about the spend for show more than necessity and that’s often what gets most people into trouble long term. As you stated, most people do live paycheck to paycheck without realizing the peril of their situation. Thank you for commenting.

  2. I fall right into that age group of millennials, if all of these stats are right then that’s very worrying. I’ll answer how each section affects me and also the actual research.

    Me – I get a lot more of my ads in video (like Facebook, Youtube etc) but I think a lot of the static ads that we saw 20 years ago (eg newspapers, magazines) are now replaced by ads on news websites, twitter etc. So I think there’s still a lot of non-video ads out there.

    Forget saving:
    Me – I save as much as I can, so this doesn’t apply to me.
    Research – This is very worrying, without an emergency fund, let alone saving for long term goals, people are skating perilously to disaster all the time. Why? It’s good for short term consumption, but in the long run it’s terrible and there will only be a bigger divide between rich\savers and not.

    Irresponsible / credit score:
    Me – N/A to me.
    Research – Again, worrying. Acting like that will just make things more difficult for people in the long run, they won’t be able to get out of the spiral.

    Student debt:
    Me – luckily I haven’t get any debt at all, so I’m in a good position right now.
    Research – It’s a sad state when nearly EVERY job requires a degree which takes HUGE amounts of debt. Everyone upskills with no real benefit for most positions.

    Jobs / the future
    Me – I’m doing my best to create my own future, even if it takes a while. Even if my website doesn’t take off, the share investing should see me in a much better position than most people.
    Research – I understand wanting to find a good job, but at the same time’ where’s the loyalty’ proving yourself and building your position?

    Thanks for sharing this 🙂


    • Hi Tristan,

      Thanks for sharing your personal experience regarding this issue. Clearly, everyone is in a different situation and you seem to be well ahead of many in your generation. I think these types of articles come around every generation as the older supposedly “established” generations always look to the young and think that they “do not know anything” and essentially are clueless to most things in life. Again, you seem to have a great handle on your current financial well being and continuing along this path will only give you greater chances of financial success in the future. I am from Generation X and there are just as many “worrisome” articles about our ability to save/spend and eventually retire. Again, it’s all a matter of personal choice and sacrifice to better our future selves. Thank you for stopping by and commenting.

  3. DivHut,

    I understand these words are from another person but it never ceases to amaze me whenever I hear how things look from the outside lens of those born outside my generation (I’m a millennial). I myself have an excellent credit score, have tons saved, invest regularly, and constantly fight onward to a brighter future. The friends I hold in my same generation are very close to what is described above – they have outstanding amounts of debt thanks to ever increasing student loans that are on too high an interest rate, constantly hold horrible jobs that have no upward mobility, have no interest in trying to save, and constantly misunderstand finances as a whole.

    From a millennials perspective however, the cause can be seen very differently from those who were born before us. I myself was raised in a house hold that is very similar to those in my generation. Like most of my generation, my parents were divorced, worked 8AM-7PM Monday-Friday and took almost no vacations, and my parents hardly ever had or made the time to ever sit down with my brother or I to explain how to handle life as it stands. I was lucky – my mother eventually sat me down and explained the ins and outs of finances but most others I know did not have this. Their parents were too busy working to give them the time of day and if my friends asked their parents to help them understand, they were pushed aside with the simple explanation that the parents were too tired or they didn’t feel comfortable sharing their earnings/ways they handle finances. In addition, schools never touched the subject.

    This leads to the lens that most of my generation holds – that the parents who describe our generation as spoiled, rotten, technology obsessed kids are to blame for not actually parenting and passing on the knowledge that is required to succeed. It’s hard to build something without the tools that are required. This coupled with the fact that the older generation coddled us too much in school was the perfect recipe for the disaster of a generation of kids and ultimately adults.

    I don’t mean to pass the blame but one only needs to realize that a small child doesn’t have the ability to teach themselves without a teacher. When we become older, we can teach ourselves but if we are too behind by the time we grow older, we’re blinded by the daunting task ahead of us. We’ve effectively been given a marathon to run but told to start from one hundred miles behind the starting line by the very coaches that were supposed to be training us to be race ready.
    Dividend Monster recently posted…My Method of EvaluationMy Profile

    • It’s not just a matter of parents not teaching kids how to succeed and manage money (that differs from family to family and isn’t really inherent with our specific generations), but just the world Millennials inherited. A world of devalued currency, outsourced manufacturing jobs, service jobs with little growth potential, constant global warfare, unrealistically high housing costs, stagnant wages, zero job security, an education system that’s absolutely worthless, and increased societal pressure to spend your way into debt slavery.

      Somehow that’s all the fault of a 19 year old. That 19 year old must have been VERY lazy.

      ARB–Angry Retail Banker
      ARB recently posted…Yanking My Chain!? I’ll Choke You With It!My Profile

    • Hi DM,

      It’s great to read a comment direct from a millenial source. Of course, every person is different and to lump everyone together and assume a whole generation of financial misfits exists is wrong. I understand that. Having been around a little longer than you, as I’m a Gen-Xer, I can recall many articles in newspapers and magazines touting the apathetic nature of my generation. Without pointing fingers or placing blame on parenting, economics or whatever comes to mind, it seems that every new generation is perceived, for lack of a better word, to be a slacker generation. A generation that is not responsible with finances, employment, savings, etc. Go back to the baby boomer generation and a lot of negativity was harnessed upon them as they came of age in the 1980s known for its excess and lack of frugality and common sense. Of course, it’s many in that generation that are currently experiencing retirement difficulties today. My point, is that it seems that every generation will be painted with one general brush stroke and as we all know there are always standouts that “do the right thing” while others do not in every generation. I value your opinion on this matter and this post. Thank you for commenting.

  4. Hi, Millennial here.

    Question: What was the point of this article, other than to remind everyone of how worthless and stupid and lazy and burdensome the Millennials supposedly are?

    Roth gives no ending conclusion to tie it all together, no solution to help Millennials into a better financial situation, no strategy for whatever companies to more effectively market to Millennials, literally nothing other than “Millennials are lazy and self-absorbed” (which, by the way, the Millennial generation does NOT agree).

    I’ve seen financial responsibility and irresponsibility in all generations. And the financial situation and futures of the Millennials is much more complicated than “Oh, this entire generation is just so lazy and entitled”. For Roth to just paint the entire generation with such a broad stroke–and to do so without giving any sort of conclusion, solution, or explanation–is more akin to watching animals in a zoo than writing any substantive about finance.

    “Oy, look at the Millennial in ‘er natural habitat! Ain’t she a beauty?”

    ARB–Angry Retail Banker
    ARB recently posted…Anjali Ramkissoon, Alicia Ann Lynch, And Living The BrandMy Profile

    • Hi ARB,

      I wholly agree with you that financial responsibility and irresponsibility exists in all generations. I just commented to Dividend Monster that my generation (X), was branded as lazy and apathetic without any drive nor social or financial responsibility. Looking at myself, I know this would not describe me nor many that I know of my age group. I think the author was looking to point out an already popular sentiment in the mass media regarding the millenial generation and nothing more. Of course, as I commented elsewhere, you cannot use one big brush stroke to paint a picture of an entire generation. I understand that and personally look at each individual, no matter what generation they come from, at face value. What you see is what you get. Sense and responsibility in all aspects of life or not. As always, I appreciate your comment.

  5. I’ve been following your blog pretty religiously as I’m very interested in the thought process you use to make purchases and manage your portfolio since you are one of the more experienced (life and investing) bloggers in this space. With that said, I was very disappointed that you agreed to publish this content under your domain. Not only is it ignorant, but it’s means-spirited, and quite honestly well below the quality of thought that I expect when visiting your site. I would assume you have many millennial readers here, of which I am not one, however, I would think this would be a big turn off to those readers as even I am slightly offended that someone would spend the time writing something so simple-minded and devoid of critical thinking. If it were me, I would even be inclined to take it down altogether – ironically, it seems like something you would have read over at the “new” Dividend Mantra after the site was sold. But I am not you, I am just a mere follower. Even so, my advice is to take the higher ground and avoid content like this in the future, otherwise you might just lose a few of those millennials who are so “irresponsible”.

    • Hi anonymous,

      I appreciate your kind words regarding my blog, purchases as well as my investment style. Of course, I always love to read comments left on specific posts that are both positive and negative. I feel that this type of direct communication better helps me gauge what readers would be potentially interested in reading. With that being said, I do from time to time, publish non-paid guest posts such as this one along with sponsored blog posts too. I understand that sometimes the opinions expressed might not be consistent with my overall blog yet does present other views that can help open discussions such as this. It was never my intention to offend any generational group from millenials to Gen-Xers to baby boomers with this post nor any other guest post and I do value your opinion regarding this matter. Going forward I will take to heart what is published on DivHut and may limit guest/sponsored posts in the future. I can only imagine how many people such as yourself feel the same way and did not bother to comment and voice their opinion. Thank you for sharing your thoughts.

  6. I guess im a 1%er 23 years old here with a dividend portfolio about to break 6 figures with it kind of gets me excited to save when i see my monthly dividends.

    • Hi AG,

      That is totally awesome for you, and you are definitely in the minority of people within your age group and older that are so far ahead financially. As I have commented, you can find people who excel in managing their finances and those that lag in every generation. Keep on your path and no doubt your financial future will look bright. Thank you for sharing.

    • Hi EL,

      I totally agree with you that history tends to repeat itself as every new generation is perceived to be the new “uninformed slacker” generation. In every generation there are 20 somethings that make mistakes and somehow they grow and mature and seem to do better than originally given credit for. Thank you for commenting.

  7. Keith,

    I know this was a guest post, but I wanted to give my thoughts considering I fall right into the millennial category.

    Preference for Multimedia Ads – Of course we prefer multimedia ads because they are shown on the technology we use and prefer. Things are shifted away from traditional media as more people cut the cords and stream on their various gadgets. We have loved the new technology and it has become a necessity in our culture.

    Forget Savings – Is this really just a millennial related issue? Sure, millennials don’t save but the average savings rate across the board and ages are low. Younger people will spend a little more and my generation is not the first to show such a trend. What about the easy credit in the 80s and 90s? Millennials may not save as much as we do or others in this community, but it is hardly a millennial generation related issue.

    I could comment similarly for the rest of the points, but I think I’ll hold off. I don’t want to sound like and angry commenter back. Sure, these are all trends in the majority of our generation and they are not positive. Are most people my age saving as much as they should…no. Are most people making the most responsible financial decisions…no. Could we step away from our phones a little more and show the working spirits of our parents generation more frequently…sure. Each new generation is different that the one before and their are growing pains along the way. I think a more appropriate theme would be the financial habits of young people of each generation, not just the current millennial generation.

    One thing I find interesting. I checked out TIna’s website and she is 30 years old, which in my opinion is still in the millennial generation. My first interpretation of the article was someone from my parents generation who is agitated by the younger generation haha But that’s not the case and I would be interested to learn more about her background and experiences with millennials that led to the article.

    Anyway, enough for me. Love the website and I’m looking forward to checking out your next article! Have a good one.

    Dividend Diplomats recently posted…T. Rowe Price (TROW) Stock AnalysisMy Profile

    • Hi DD,

      This guest post really seemed to rub many people the wrong way which is kind of good in a way as it opens up a discussion about how every generation, not just millenials, handle their finances. I totally agree with you on many points you mention in your comment. The fact is that every new generation is perceived to be financially illiterate to some extent. I had mentioned in a comment above that I very clearly remember my generation (X) being branded as lazy and apathetic without any drive nor social or financial responsibility. Of course, this did not represent me at all as I started my own business almost 18 years ago, went to college, graduated debt free and even invested in stocks at age 15. Of course, this article is very one sided but it does illustrate one viewpoint and I’m sure the author understands that these generalizations do not apply to all in the millennial generation. Thank you for stopping by and commenting.

  8. I would like to see the facts on this but from what I see, Millennials fall into two categories. The one that you just mentioned and the other being extraordinarily motivated.

    • Hi Greg,

      You said it. The truth is what was said in this post can really be said of every generation. My generation (X) was also branded as financially irresponsible, among other things, which obviously doesn’t represent me. The bottom line comes down to personal motivation, drive and responsibility and not a whole generational group. Thank you for sharing your thoughts.

  9. Interesting article. Although I feel it was very one sided toward bashing Millennials (yes, I’m a millennial). I could easily say the same thing about a number of other generations. I appreciate the look at the Millennials stats, but I thought it would be more balanced (aka They are irresponsible). I appreciate your opinion and effort you took into creating this article.
    Wallet Squirrel recently posted…SE vs SEP, My First Journey to into Oil & Gas StocksMy Profile

    • Hi WS,

      This guest post got quite a few millenials commenting and sharing their differing views on the newest branded generation. While the post presented one viewpoint I do agree that not everyone falls into these generalizations regarding finance. It’s interesting to note that the post author is a millenial herself and from what I gather is very financially responsible. As always, I appreciate your comment.

  10. Millennial here,

    First, I’ve been following your site for while and come back pretty often — so keep up the good work. 🙂

    As for millennials.. we’ve been given a raw deal…with the cost of housing and schooling being much higher than it was for previous generations (you didn’t even need a university degree to get a decent job 30 years ago).. coupled with the fact that there are fewer and fewer decent paying jobs becoming available.. it’s no wonder many of us are getting ourselves into debt.

    I think the real problem, however, is that we’re failing to see the huge economic discrepancy between our generation and that of our parents. Many of us have grown up living a certain lifestyle (while living with our parents) and expect to be able maintain that same lifestyle into our early adult lives (that’s what we were promised anyway). Unfortunately, we’ve been slow to realize that the economic realities we were promised (and were trained for) haven’t come true… and we consequently haven’t been given the tools to navigate the current world.

    Our generation’s economy resembles more that of our grandparents than that of our parents.. and it’s from our grandparents that we should be taking advice.
    Andre recently posted…Book Review: Your Money or Your LifeMy Profile

    • Hi Andre,

      Thank you for your kind words regarding my blog and I appreciate your continuing support by visiting and commenting.

      I often read about how the millenial/Gen Y crowd will be one of the first generations to have a lower standard of living than their parents. A point you illustrate in your comment. While we seem to know all the reasons the millenials are “doomed” I rarely, if ever, read about a solution on how to deal with the debt and employment issues your generation faces. It seems that there’s a lot of finger pointing without any meaningful answers to the problems of the day. That being said, I’m sure everything will work out fine in the end. Generation X, of which I belong to, was also branded as being socially and financially apathetic and somehow things eventually fell into place for us. Common sense will always win the day no matter when or where you are born. Thank you for commenting.

  11. I really liked this article as a millennial myself. It really coincides with all of my observations of my friends’ and former classmates’ lives. Most are not doing so hot when it comes to personal finance and career development.

    The big picture consequences of this are what’s important to grasp, and there are many to take. Lower incomes will mean less income tax revenues for the government and possibly higher taxes down the road. This will also put a strain on our social programs such as social security and medicare when it comes time for millennials to retire, as they will probably not have much savings to fall back on. Lower household formation by millennials should keep housing prices suppressed. Add to that the fact that many baby boomers will sell their houses before passing away or downsize in retirement and you have even more downward pressure on housing prices.

    The same may hold true for stocks as well. Fewer savings and retirement contributions by millennials in combination with baby boomers withdrawing from their accounts to fund their retirement could damper stock market returns for many years.

    These types of macro trends are important to keep in mind and the millennials are going to be one of the key factors in this. Keep up the interesting articles and happy investing!

    • Hi stillcode,

      Thank you for sharing your observations as a millenial. While a grim picture seems to be painted for your generation I am not too worried that long term you will be just fine. I have commented elsewhere that my generation (X) also was branded as socially and financially apathetic without any drive or career goals in mind. Of course, branding an entire generation with one brush stroke is wrong as I did not fit that description at all and by the looks of your comment neither do you. While you may have friends and classmates that are “living the typical millenial lifestyle” one cannot help but think of the few that do not live in that manner which no doubt will help raise your generation as a whole. Macro trends aside, it seems that somehow everything will fall into place eventually. Part of the reason I am a dedicated dividend growth investor relates directly to one of the things you mention in your comment regarding social security and other government social programs. Who knows how it will look in 25 or 35 years from now. By being a dividend investor I’m taking steps to generate my own cash flow in retirement and be less reliant on government programs in retirement. Thank you for stopping by and commenting.

    • Hi Joan,

      Not all financial habits can lead towards debt. Obviously there are good financial habits and bad. The bottom line is that one should manage their expenses to be in line with their income. Always spend less than you earn and you’ll never get into any type of debt. Don’t borrow excessively either and focus on accumulating income producing assets instead of just regular assets. A lot of common sense can be applied towards managing ones finances and minimizing debt. It shouldn’t be too difficult. Thank you for commenting.

  12. Not sure I agree with a lot of these statements. To say things like “Millennials are from from understanding the role of saving”. Or, “Millennials have the worst credit report…….are lazy and self-absorbed.” Those are generalizations of an entire generation. We should be looking at things like wage stagnation : http://www.epi.org/publication/charting-wage-stagnation/ to help explain things. Increased college costs, I’m still in school and they just announced a 5.6% tuition increase for this coming school year. Please don’t generalize us as we make our way through the world that was created by the generation before us, do they not bear some of this responsibility?

    @Dividend Monster, I totally agree man.

    • Hi GYI,

      This blog post seemed to ruffle a lot of millennial feathers and I do agree that using one broad stroke to classify an entire generation as “irresponsible,” “lazy,” or “self-absorbed,” can be misleading. The truth, is that every generation had its own issues to deal with in its time, whether it was war, inflation, tuition costs, excessive personal debt, recession, etc. As you know, this was a guest blog post and does not reflect my opinion. Thank you for sharing your thoughts.


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