While old may certainly be gold, here are 5 personal finance tips Millennials have to share with Baby Boomers.
Baby Boomers is the name given to the generation born in the years after World War II till about the mid-1960s. This is probably the last surviving generation that knows the art of squeezing toothpaste out of hopelessly dry tubes. We are not complaining! Born in a war-ravaged world, Baby Boomers didn’t have the luxury of choice. They had limited resources at their disposal and had to make the most of them. Hence, living a frugal lifestyle was born out of necessity rather than choice.
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The scars of war faded with time and days got brighter. Abundance replaced scarcity, but the generation called Baby Boomers did not let go of their frugal ways. We don’t blame them. They had seen some very dark days and didn’t intend to see it again. In spite of all the prosperity around them, they continued to save and invest like another war was just around the corner.
This stood in stark contrast to the lifestyle of the Millennials – the generation born in the years spanning the 1980s to 2000. During this time, great strides were made in technology and the medical industry. Life for Millennials just kept getting better. They were spoilt for choice and had access to conveniences that their parents didn’t even dream of.
While many Baby Boomers grew up in a war-torn world, Millennials witnessed a blurring of national boundaries towards the creation of a global economy. As a result, the personal finance habits of each generation stood in stark contrast to each other. Baby Boomers believed in pinching pennies, while Millennials believed in living it up. However, doing the latter comes at a price.
You can often see Baby Boomers chiming in with their two cents on the importance of building savings and investments to the younger generation. Although their wise words hold true, the older generation could also pick up a few financial habits from Millennials. Not all of them are as careless with money as it may first seems It’s just that the priorities of the two generations differ, but it isn’t a gap that can’t be bridged.
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Here are 5 personal finance tips Millennials wish to share with Baby Boomers.
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Stock Up On Experiences Not Things
Baby Boomers struggled to meet even the basic necessities of life, nevermind coming up with a budget for entertainment. If you go shopping with a Baby Boomer, you’ll see them spending generously on groceries and being miserly on everything else. If you open their wardrobe, you’ll still find decade-old faded clothes. Every storage space will be full and very little goes into the garbage bin. Living frugally is an old habit and old habits die hard.
If given a choice between buying a car and going on a world tour, Baby Boomers will choose the former. Any expenditure that offers security and stability will be preferred over one that offers something vague like peace of mind.
Millennials are slightly different. They like to try out new things. They like to stock up on life experiences. Traveling, exploring new places, essentially doing something new. Baby Boomers must adopt this habit. How about stocking up a little less and going out a little more. This will be refreshing for your mind and soul and the older generation will realise that they don’t need to hoard things to live a happy life. Happiness can be found beyond the material world as well.
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Partake Of The Sharing Economy
The world has become an expensive place. What do you do when you want it all but can’t afford it? You share. Sharing is a crucial characteristic of the Millennial way of life. Cab-hailing apps like Uber and Ola, travel websites like Airbnb etc. are a hit with the younger generation because they make luxury and convenience affordable.
Baby Boomers can try the same. Instead of hiring a cab just for themselves, they can share it with someone else and also share the cost. Baby Boomers tend to purchase things they are in need of. The millennial ways of meeting needs is hiring/ renting and not buying. They hire everything from cars to clothes and get the best experience for an affordable price.
If the Baby Boomers are wary of hiring, they can choose to make or join a community where sharing takes place among known people. Communities are a great way to make new friends and exchange goods, services and stories.
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Get The Latest On Investing
One might think that Baby Boomers are far more proactive with regards to investing than Millennials. This may not actually be true. Millennials appreciate the benefits of lucrative investment options as much as the older generation. In fact, Millennials are smarter about it.
While Baby Boomers rely on tried and tested methods of savings and investments like a Fixed Deposit, Millennials take to the internet and find out about the new offerings in the market. They invest in Debt Mutual Funds, Stocks and other offerings that Baby Boomers shy away from.
Moreover, Millennials don’t take impulsive decisions (though it might seem so on the outside). They compare and evaluate options before taking a decision. This is something Baby Boomers can learn from. By finding out about new investments in the market they can spread out their portfolio for rich returns.
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Take Financial Advice
Back in the day financial advice didn’t come cheap. One needed deep pockets to pay advisors. Money attracts money is an old adage. This is not the case anymore. Internet and technology has automated the financial industry as well. All you need is to provide some basic details and you will be presented with a hundred options. You can create a financial portfolio for yourself in seconds and get a low-down on how and where you should invest.
Millennials are generally fickle with their investments. They don’t stick to one phone or one job for long. When the next best thing comes around, they make the jump. You must do the same with your investments. Keep an eye on all your investments and keep tracking the gains. If something new and better offers you richer returns than quickly grab it. There is no need to stick to an investment plan after the sizzle has died down.
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Learn On The Go
A characteristic of Baby Boomers is being wary of everything. They think twice before taking any decisions. While this isn’t a bad thing, overthinking can cause a considerable amount of delay and good deals might just slip by.
Millennials on the other hand are quick thinkers and don’t procrastinate much. They know what they want and when an opportunity arises they quickly grab it.
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Baby Boomers, we are not asking you to throw caution to the wind; all we ask is that you not look at everything with suspicion. If you are wary of the new investment offerings then read up on them. The internet has the answers to everything.
Once you are aware of what’s available in the market, you can take decisions faster. Take guidance from Millennials and this combined with your wisdom is sure to show results in the form of successful investments.