The top tools millennials are using to keep their financial houses in order.
Technology is central to the lives of millennials and it is no different when it comes to managing finances.
Millennial birth years are typically between 1980 and 2000, and the millennial generation has been called “the always-connected generation,” because of their growing up with the internet, cell phones, social media, and a more connected world than any generation before them has known. It makes sense, then, that when it comes to handling something as significant as personal finances, millennials would naturally turn to technology to help answer their most pressing financial questions, increase their financial literacy, and help to manage their money. While the monetary goals of Generation Y may vary, one consistent millennial financial habit is an increased use of apps and other technology to help streamline their finances and reduce the stress of money management.
Here are some things that are helping millennials get a handle on their money and that financial institutions need to understand to market their services to this growing population.
While every millennial may not want to buy a house straight out of college, they do have financial goals and know that keeping an eye on their credit score is helpful in reaching many of those goals. CreditKarma, a credit monitoring website, has been around for a while and is appealing to millennials for many reasons. First, it’s free. Second, it’s extremely user friendly. Third, it offers instant access to credit scores to a generation that is used to getting data instantly. It offers unlimited credit reports as well as credit monitoring. Additionally, it has credit card comparison features and a library of resources to help millennials increase their financial literacy.
Research on the millennial generation indicates that opposite of the baby boomer generation, millennials are less likely to seek advice or information from a financial advisor, and instead will turn to technology such as the website Investopedia. This site wasn’t necessarily designed with Millennials in mind, but it takes financial information and makes it very digestible. It not only delivers current news in finance and financial industries, it provides a robust library of resources to address everything a beginner would need to know, including information on 401ks, IRAs, and money markets, among other things. It also helps answer questions such as how to finance an education, pay down debt, buy a house, save for a life event such as a wedding or vacation, or plan for a child’s education.
Millennials’ financial habits are often supported by budgeting. Mint is a free, easy-to-use service that tracks both spending and bill due dates. It allows users to create a budget and compare it to their spending and even offers suggestions on ways to alter spending. Mint can be set to alert users when bills are due, as well as when they have gone over a budget in certain areas. Because it’s so customizable, it’s a popular choice when it comes to budgeting tools among millennials.
There are plenty of ways in which technology has changed how millennials approach finances, including online-only banks and automatic savings apps, all of which have helped to increase millennials’ financial literacy and make sense of their own financial goals. Like many areas of this generation’s life, technology has helped to manage millennials’ financial habits, often through offering solutions that are free, easy to use, customizable, and help them understand and reach their goals. It is critically important that financial institutions understand millennials’ perspective on financial management in order to connect with them and offer services that fit their lifestyle.