Baby Boomers versus the Millennials – when it comes to managing money, which generation takes the title?
Let’s review the stats and see who the real financial heavyweight is.
Round One: Saving
While Millennials believe ‘the future is now’ and will treat themselves to new shoes and $20 cocktails, Baby Boomers are much more cautious.
According to a survey by the Australian Securities and Investment Commission (ASIC), nearly 40 per cent of Millennials (18 to 35 year olds) say they often buy things on impulse, compared to 20 per cent of Baby Boomers.
Millennials were also twice as likely to live “for today” than their parents, which might explain the fancy wardrobes and Euro trips!
The conclusion? Baby Boomers are better at saving money than Gen Y.
Winner: Baby Boomers
Round Two: Business
Unlike the Baby Boomers, most Millennials come from small or single-child families. This means they are used to dealing with figures of authority on a one-on-one basis.
Most Baby Boomers on the other hand, come from big families where hierarchy, deference and respect are valued. While this may be good for the dinner table, it is not always an asset in the boardroom.
Millennials have the negotiating skills and tech savviness to out-run their Baby Boomer parents. Just look at Gen Y leaders like Mark Zuckerberg (Facebook CEO, 31) and Pete Cashmore (Mashable CEO, aged 30)!
Round Three: Financial literacy
Despite greater access to information, the ASIC survey found 21 per cent of Millennials have difficulty understanding financial matters, compared to 11 per cent of Baby Boomers.
And while Millennials have no problem turning to friends and family for financial advice – unlike their parents who were taught it was bad manners – only 44 per cent of Millennials say they try to “stay informed”.
In this case, the winner is too close to call.
Round Four: Planning and money management
Millennials have busy, active lives that can often complicate and postpone money matters.
According to the ASIC survey, 16 per cent of Australians under 35 said they were “too busy” to sort out their finances and nearly 40% said dealing with money was “stressful and overwhelming”.
On the other hand, Baby Boomers make time for money matters. Only 4 per cent are “too busy” and nearly 70 per cent say they are “confident” about managing their money.
In this case, the Baby Boomers are the clear winner.
Winner: Baby Boomers
And the winner is … the Baby Boomers.
But it is a close match. The Baby Boomers and the Millennials can each learn from one another on how to better manage money and plan for the future.
The ASIC Scorecard
Below are the key findings of The Australian Financial Attitudes and Behaviour Tracker.
|Gen Y %
||Baby Boomers %
|Dealing with money is stressful and overwhelming
|I often buy things on impulse
|Financially I like to live for today
|I have difficulty understanding financial matters
|I am too busy to sort out my finances at the moment
|I am confident when it comes to managing my money
|I try to stay informed about money matters and finance