Millennials have been dubbed the socially conscious generation that craves flexibility above financial gain. Survey after survey of millennials in the workplace paint a picture of millennials valuing flexibility (like the ability to telecommute into the office) and work environments as the most important aspects of a job.
We also know that millennials aren’t necessarily jumping at the opportunity for certain financial milestones like home ownership. At least not right away. A survey by TD Bank shows how millennials are moving at a much slower pace on the path to homeownership in comparison to past generations.
Unfortunately, this has lead to a bit of a stigma in which millennials are entitled, lazy and don’t care about fiscal responsibility. Nothing could be further from the truth, especially when it comes to money.
Why Millennials Do Care About Money
Some millennials may not be interested in financial milestones like owning a two bedroom house with a white picket fence, but that doesn’t mean they don’t care about money. Additionally, caring about social causes and caring about finances aren’t mutually exclusive. You can easily do both.
In fact, millennials haven’t had a choice but to care about money since they entered the job market. Going six months without a job like I did will definitely force you to face your financial life.
An average of $31,000 worth of student loans before you even get a solid footing in the world will also force you to look at money every single time your paycheck goes to your student loan repayment.
This isn’t to complain, every generation has their challenges and it’s up to individuals to overcome them. It’s just that this generation was thrusted into a world with serious financial issues before they even found their first job. To assume that they don’t care about money when they have some very real financial challenges would be premature at best.
What Millennials Are Doing to Get Their Financial Life Together
Because millennials have some very real challenges to face when it comes to finance, they’ve had to find solutions. These are solutions that our parents may never have tried themselves. You could say that our idea of stability is a little different than that of previous generations.
According to a survey by Bentley University, it would seem as if millennials believe they need to be more flexible and independent in their careers.
In the past, the corner office was the ultimate career goal, but millennials don’t seem to see it that way. In fact, only 13% of those surveyed cited that climbing the corporate ladder was one of their goals. By contrast, nearly two-thirds of respondents said they wanted to run their own business.
According to a CNBC report for earlier this year, entrepreneurship has been on the rise for the 24 to 35 age group. So much, in fact, that it would seem as if millennials are far more bullish when it comes to entrepreneurship than past generations.
For many, like myself, this trend started when they couldn’t find a job or found themselves underemployed. They saw the opportunity to make more money on their own and went after it. This is a smart move since self-employed individuals earn an average of double what permantly employed individuals make. This is nothing to sneeze at.
For others, a better economy and technology have made it easy to take ownership over their careers and finances as business owners. It’s easier than ever to find gigs online, and self-employment allows millennials to have both the flexibility they crave and money.
This is also a common theme I see as a millennial business coach and finance expert. Earlier this year I surveyed my list about what they wanted to see me write about. A mind numbing 81% said they wanted content that would teach them how to quit their jobs so they could start working for themselves. They barely even paid attention to the other options they could have chosen from.
Job hopping may seem entirely counterintuitive to making more money. Traditional wisdom says to stay at one place, put in your hours and move up the ladder. As we’ve already discussed, this scenario doesn’t fly well with millennials.
As a former recruiter, I also had a very hard time wrapping my head around this. I also had to deal with several companies who couldn’t figure out why they couldn’t retain millennial employees.
While there are several factors that can go into why someone leaves a job, it usually comes down to lack of growth opportunity and money. These were the two most cited reasons when I interviewed millennials as a recruiter from 2011 to 2013.
Before getting into that, let’s first be fair and realize that by general rule young professionals of every generation tend to job hop. However, in the case of millennials they were only sticking at one job for an average of two years before moving on to the next one. This was driving employers insane.
Now we know this could just be a tactic to make more money. It’s much easier to to get a new job and leverage a 10% raise with your starting salary than it is to hope for a 1% raise at your current job.
While mathematically it makes sense, it’s too soon to tell whether or not this may backfire. However, one thing is for sure, the traditional career rules of previous generations don’t seem to work for millennials.
Where Millennials Can Improve
It’s no secret that I’m very pro-millennial. After all, I am one. However, I can be fair and admit that we do have some room to improve in the financial arena.
Namely, we need to start investing more. Millennials are socking away cash like they're never going to see it again. Think of it as the modern Depression Era way of stuffing cash under a mattress. While it’s great to save (which millennials are apparently very good at), it’s not going to beat inflation over time.
Unless they want to run the race of constantly needing to make more money down the road to account for the increased prices of goods, millennials need to start investing some of their money and letting it grow in a way that can account for inflation later.
Yes, millennials are socially conscious. Yes, they are taking their time with big financial steps. Yes, they crave flexibility. But this in no way means that they are avoiding fiscal responsibility. Challenges like a weak economy and massive student loan debt have forced this generation to forge a new path and make new rules, and money is definitely a part of the equation.