Millennials love to spend money they don’t have
“I want the world, I want the whole world, I want to lock it all up in my pocket, It’s my bar of chocolate, Give it to me now!” — Veruca Salt in “Willy Wonka and the Chocolate Factory”
Studies show Millennials want things, and they want things now.
Larissa Faw at Forbes described Millennials — those born between 1981 and 2000 — as “bipolar” in their fiscal habits.
“The majority of the 79 million U.S. Millennials are either unemployed, underpaid or weighed down with student loans,” Faw wrote. “One in four Millennials, for instance, has more debt than savings, according to Bankrate.com. … The current unemployment rate among workers ages 20-24 is 13 percent, compared to 8 percent for older workers, according to the most recent economic data.”
And yet, they are spending like there is no tomorrow.
“Millennial college students (without full-time jobs) spend $784 a month on discretionary expenses, especially food and entertainment, according to the Mooslyvania marketing agency,” Faw continued. “Millennials are the largest demographic purchasing new technological gadgets and fashion apparel. And their spending on jewelry increased 27 percent in 2011, according to American Express Business Insights. They even start riots at outside retail malls over $200 limited-edition Air Jordan sneakers.”
They focus on instant gratification. They have different values than older generations and define luxury on functionality. There are some things they just can’t live without, according to the Forbes article.
And unlike previous generations that focused on spending on family, Millennials “spend their money on themselves, primarily on technology and travel.”
An article by Julie Halpert in the Fiscal Times cited one 27-year-old who bought a new $300 Android cellphone because it was a “necessity,” yet drives a 1997 Camry.
David Bakke, editor of Money Crashers Personal Finance, told the Fiscal Times that in the past younger people coveted the latest jeans. Now they covet the latest iPad and 4G smartphone — and they are “must-haves,” not discretionary.
And where is the money they don’t have coming from? The Fiscal Times says it is from credit cards — and the mother and the father.
In PJ Lifestyle, Dave Swindle, a Millennial, called this irresponsible spending is “embarrassing.” But “in my generation’s defense,” he pointed to the national debt as proof that his predecessors do not do any better.
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