Author: Grace Durie
Millennials and socioeconomic insecurity
You might have heard some of the many words that have become synonymous with the millennial generation, take: ‘Fleek’, ‘FOMO’ and ‘Bae’; but there is one that stands out for all the wrong reasons, and that is ‘Debt.’
Generation Y are some of the most debt saddled among us; and why is that? Looking at the millennials, it’s easy to identify us as financially irresponsible, as a generation of adventurers, unhappy to settle for the solid corporate jobs that kept our baby boomer predecessors financially solvent and desk bound.
This depiction is too two dimensional, Generation Y have seen our world change from the relative peace and stability of the 1990’s to the socioeconomic insecurity that has characterised the years since 9/11, and we have had to cope with the changes that insecurity has wrought.
Financial instability and debt
Debts have become something of a minefield; the toxic combination of ever increasing student loans, inadequate pension funds twinned with huge rent increases and the average deposit needed to buy a house in London a staggering £91,000 has meant that an entire generation has been subject to huge financial instability… It would seem that becoming adults in the middle of a recession has meant that debt is unavoidable, however averse we millennials are to the very notion of it.
With the problem evident, and with an entire generation expected to shoulder an estimated £6 trillion worth of national debt alongside their own mounting personal debt, there is a lack of obvious answers forthcoming from the financial services industry…
Should financial services do more?
‘But what can banks and others be expected to do?’ Is the natural response, the national debt is not something that can be written off and banks cannot reasonably shoulder 100% of the blame for the extortionate cost of housing in London or for the crippling cost of student loans. Millennials reluctantly acknowledge that miracles are not about to happen, that the debt is not about to disappear, in fact 46% of millennials worry about getting themselves out of debt, so actually all we’re really asking for is helping hand.
So we accept that debt is inevitable, and the help we want is actually an efficient way to manage the debts that we have. Only a third of us feel that financial services providers are providing the means to budget, and keep track of the money that we owe and the money that we spend. Essentially we want our banks to put more effort into creating a means of digitally balancing the books, a way that renders the hassle of creating and maintaining a budget spreadsheet obsolete.
The need for more accessible omni-channel banking
It’s a solution that, whilst not freeing millennials from debt, would create transparency. Turning a debt into something more controllable that fits with the digital lifestyle that the millennials have built for themselves. With banking becoming every increasingly digitally driven by the day, surely it’s only a matter of time before the digital generation get a digital way to manage the great and unavoidable debt?
Connecting with generation Y via social media could be one way to help millennials deal with debt, learn more in our Webinar – What is realistic for financial services to achieve via social media channels? [pdf]