It never fails to surprise: what kids and young adults do with their money. Whether it’s their pocket money, gift money, or money from part-time jobs, the way in which young people spend their hard-earned cash can provide insight into the changing trends of our time. But the question remains: how exactly do the young allocate their income? In this article, we’ll look into how the money of our younger generation is being spent.
1. An Age of Splurging–How Young People Navigate their Finances
Every generation living within the same elapsing time period is subject to different social and economic elements. Historically, each generation has found its own unique way of dealing with the same fundamental issues such as money, housing, and career choices that everyday people come across. The millennial generation is no different and brings with it specific practices when it comes to handling money – and it is all about splurging without compromising on the basics.
YOLO, But Invest
Modern day young people recognize the trend of ‘you only live once’ and subsequently, they act upon it. This led them to engage in spending, more than any other generation before, on leisure experiences such as vacations, dining out and experiences like living in beach shacks near the shoreline. This definitely explains the why and how of young people having less personal savings than previous generations.
However, the current generation of young people also show a sense of financial prudence. Covering costs for especially bigger ticket items like mobile phones or cars, affordable housing and securing steady incomes, have all become priorities in a way that has not been prominent before.
- Young people seem to have entered a phase of splurging, provided that basic necessities of living are taken care of first.
- Millennials are also investing more in securing their future, for example covering costs for larger items, obtaining stable incomes and prioritizing secure housing.
- Unlike older generations, young people tend to place value on experiences instead of savings.
2. The Rising Costs of Being Young
Growing up comes with a high price tag. As a young person in today’s world, you are expected to be financially independent and you often come up against many costs that make this difficult.
The costs of just living day to day can be daunting. From rent and essential household bills to everyday items like food and mobile phone plans, it all adds up. On top of that, the cost of socialising can be high. There are the nights out with friends, the drinks and the fashion trends that are often seen as must-haves if you want to fit in. Activities like going to the cinema, hikes or road trips come together and create an even bigger cost.
Here are a few ways to stretch your finances so you can have a great life as a young person:
- Plan your budget and stick to it – this sounds obvious but it is so important and often overlooked
- Look out for coupons, discounts and deals – most places these days offer some sort of discount, so take advantage of them when you can
- Shop around to get the best prices
- Learn to cook and meal prep – you can save a lot of money and calories by cooking your own food
- Take advantage of student discounts – it requires a bit of effort that is well worth it
The costs of being a young adult can be intimidating at first glance. However, with a bit of research and planning, you can minimise the impact of the expenses and make them more manageable. Sometimes all it takes is a little extra effort to make sure you can have fun and still stay within your budget.
3. Examining Shifts in Young Spending Habits
As the landscapes of retail and spending change dramatically due to the urbanization and increase of disposable income, studying the spending habits of young consumers presents an interesting look into how these new trends are shaping the industry. By evaluating what types of spending young people are engaging in, businesses can better predict and adapt to this ever-shifting market.
Young spending habits demonstrate that the traditional shopping experience has shifted dramatically over the years. Here are just a few ways how young people are spending their money differently:
- Subscription Services – Rather than purchasing goods one-time, young people are emphasizing convenience and loyalty and thus opting for subscription services with regular delivery.
- Online Shopping – With the convenience of internet-based shopping and delivery, young people are shopping more online to avoid the pressures associated with physical shopping.
- Experiential Purchases – More and more, young people would rather invest in experiences than in goods. Studies show that most young people prioritize attending a movie or concert over buying an item of clothing.
For businesses to stay afloat in this ever-changing retail world, they must understand how to engage with young people and their habits. It’s crucial to examine young spending habits in order to better reach this diverse and ever-evolving group of consumers.
4. The Financial Realities of Young Adults Today
The challenge for many young adults today is securing financial stability. Unexpected life events like medical expenses, family responsibilities, and unexpected job loss can quickly precipitate a crisis for young people living paycheck to paycheck. Young adults today are especially burdened by larger costs of living, including housing expenses, student loan payments, and irregular freelance work.
Fortunately, young people have options when it comes to managing finances. There are numerous initiatives and services available to help young adults develop financial literacy and build a secure financial future. These include government programs, education initiatives, and financial planning services. With the right resources and a bit of creativity, young adults can take charge of their finances to create a secure and prosperous future.
We are the torchbearers of future generations, and the way we manage our finances today can have an impact on generations to come. By understanding the way the young use their money, we can better educate and support our youth to make thoughtful decisions which balance the wants and needs of the present, with an eye on the future.
The efforts of the young, although sometimes viewed as reckless or irresponsible, can also be seen as a source of financial ingenuity and new ideas that shape the future and drive economic growth. By being mindful of how we spend and manage our money, we can all make our mark on the world— no matter how young.