Americans have come to know my generation as one with historically low financial confidence; we aren’t getting married; we tend to be dependent on parents longer; and we carry insurmountable student loan and credit-card debt.
I get it: Millennials are a bit frivolous, and we have very different saving and spending habits that don’t necessarily align with those of our parents (Gen Xers, or sometimes Baby Boomers). But we’re also a generation full of idealists weighed down by the fiscal shortsightedness of generations before us. As Lady Gaga put it, we were “born this way.”
There are always exceptions, and I consider myself one of the lucky few in my age range to be relatively fiscally solvent (this started with grandma, of course).
As a youngster, I spent much time with my maternal grandparents. Grandma and Grandpa Halter (of the Silent Generation) were reared by parents whose lives and spending habits were extraordinarily frugal, influenced by the Crash of ’29 and Great Depression. So they taught me, as their parents had them, the virtue of penny-pinching and what difference it can make in hard times.
Meanwhile, in the ’90s, Mom and Dad were building a typical middle-class family in the suburbs of the South. Mom, a nurse, and Dad, a pharmacist, financed midrange vehicles, and when my brother and I were 5, we moved into a 2,800-square-foot house my father had built to match one he saw in Southern Living magazine. We weren’t affluent, but we lived with ease brought about by better economic times.
“Millennials are more burdened by financial hardships than previous generations, but they’re optimistic about the future,” the Pew Research Center reported in March. “Millennials are the first in the modern era to have higher levels of student loan debt, poverty and unemployment, and lower levels of wealth and personal income than their two immediate predecessor generations had at the same age. Yet, they are extremely confident about their financial future. More than eight in 10 say they currently have enough money to lead the lives they want or expect to in the future.”
We’ve adapted to reality — and rather than hope for extravagant living situations or cruise vacations, we’d rather live simply and efficiently (well, most of us).
Perhaps it isn’t the spending that has changed, but how little you get for it. Spending the bucks we saw our parents spend on ice cream outings and zoo visits seems no longer to be leisure allowance, but paycheck-to-paycheck living.
Keeping in mind the lowering of expectations and changing of ideals, there are things you can do to help yourself and/or members of generations to come:
1. Get ahead while you can. If you begin saving when your costs are low, you’ll spend less time catching up down the road. It’s never too late to start putting a little back for the tough times.
2. Don’t be like the rest, and don’t compare yourself to them. Don’t spend money you see others spending on things you think you should have. Keep your ideals in perspective.
3. Remind yourself of the end game. Keep in mind that without a couple of bucks, you could get caught in sticky situations. It helps keep your wallet closed.
I knew at a young age that one day I would need savings: First I planned to move to New York City, then to Chicago, then to spend a year globetrotting. Eventually, I spent it on what really mattered to me, moving halfway across the country to make a new life for myself. I would have been in a jam without the money I began putting away much earlier.
That’s what kids need to hear: Remind them that one day they will want to get away, explore and make new lives for themselves without needing benefactors. Don’t hold new cars, big houses or ocean cruises over their heads, but rather the idea of independence, and the scary fact that they could get stuck without it.
I’m no saint, but I remain practical and forward-thinking about the money I spend and what I get in return. When the time came to buy my first car, I paid cash for something I knew would be reliable and that I could maintain without a credit line. When I’m able, I shop at second-hand stores and buy whatever I can find on Craigslist. When something breaks, I fix it or repurpose it.
My childhood was filled with Depression-era thinking, and I’m better for it. Don’t be afraid to preach realism to your idealistic progeny:
It’s better you break it to them before that dark, unforgiving tax man takes a truncheon to the kneecap of penniless youth.