On average, the Millennials of today have higher wage-earning potential than their parents. Money is viewed differently, especially when a person fresh out of college starts working at 5 or 6 figures. There’s not the typical entry-level payout and it’s changing the Millennial view in regards to cash flow. Below are 5 examples of overspending and how it’s hurting the next generation.
Modern culture has changed
There are so many trends in our culinary culture today and it impacts many Millennials. With increases in food services, food quality, and food education, the prices are more inflated than ever before. Published by USA Today, “The average Millennial eats out five times a week, and between Starbucks runs and bar tabs, it’s making it harder for them to develop a savings habit.”
It’s all about convenience
Many busy Millennials will make purchases solely because of convenience. Once click online shopping, a quick browse through an airport lobby, payment by simply tapping a smartphone or watch… It’s all too easy to buy things on a whim. As we list the common examples of overspending, convenience purchases may be the largest threat to today’s modern Millennial.
Influenced to chase their dreams
So many times we’ve heard stories of people quitting their day jobs to pursue their passions. They are influenced to purchase expensive coaching, as well as agency help, to grow their business. While it works for some, it does not always work for all. And, to add further interest to the story, the targets of life coaches are aimed directly at those in the Millennial generation. According to Forbes, a personal life coach could cost up to $15,000. That’s a huge chunk of money and since there is no guarantee of a return on investment, it’s very easy to overspend on these types of services.
The need to stay connected
In recent years, cell phones have made leaps and bounds in terms of technology. With all the added features, so comes the added costs, and the younger generations are footing the bill. In an article from Market Watch, “Millennials spend more than an average of $2,300 per year than older generations on five key items: groceries, gas, restaurants, coffee and cell phone bills.” With extremely hefty price tags, we’re listing all the bells and whistles of modern day cell phones as prime examples of overspending.
Not counting the little things
As mentioned before, everyday conveniences are chipping away at savings. The other aspect of the problem is that Millennials are not sufficiently tracking their smaller purchases. Every transaction under $10 falls completely under the radar. Little by little, the account is drained. Even though a drive-thru lunch or coffee may seem like an insignificant purchase; if someone makes enough of them, they are one step closer to being broke.
How does this change?
After discussing some of the trends, it’s easy to recognize the examples of overspending. By understanding the shifts in financial behaviors, we can work towards a different outcome. Regardless of your generation, there are hacks for saving money while still enjoying life. There are ways to purchase with intention. Continue following the Achieva Life Blog for more details.
Resources:
USA Today, Millennials eat up savings by dining out a lot, study shows
Forbes, Should you hire a life coach?
Market Watch, This is why millennials can’t have nice things (or save any money)
