COVID-19 Will Change How Millennials Save Money
The Coronavirus is the latest economic disruption for Millennials who are prioritizing the next crisis over their retirement
- Current emergency funds are not cutting it for Millennials.
- Office perks are no longer a priority. Potential employees want to see real benefits.
- Advisers must adapt to cater to the changing needs of Millennials and Gen Z.
As a generations researcher and author of the forthcoming book, Zconomy, I recently shared my thoughts with PlanAdviser about how the pandemic is impacting Millennials’ savings habits. This is an absolutely important topic, because Millennial savings habits will impact how they view work, education, spending, and future decisions. I’m also a Millennial, so this is near and dear to my heart.
The necessity of an emergency fund
Having lived through the economic downturn of 2001, the Great Recession of 2008, and the current pandemic, Millennials, myself included, have experienced several periods of rapid and dramatic fiscal disruption. Add in student loan debt, the rising cost of housing, and childcare expenses to the mix, and it makes sense that Millennials want something different than simply saving for retirement.
As I told PlanAdviser, “The challenge for many of these workers is that their emergency savings accounts couldn’t even cover two months of living expenses, and certainly not many months or longer. What we’ve seen is that many Millennials have drained their emergency savings accounts, and if they have retirement funds, they’re figuring out how to tap into those.”
At CGK, our team of researchers is leading ongoing national studies into Millennials and each generation, particularly looking at the impact of the pandemic on them and their spending, work, and future. I frequently share these must-know findings and strategies with leaders through my customized virtual presentations, virtual executive strategy sessions, and interactive webinars.
Real benefits that employees need now
What Millennials want is to find financial security, especially in regard to being prepared for the next crisis—as they can’t make up for not being prepared for the current crisis. As I told PlanAdviser, “When people go through times of tremendous emotional, physical and financial stress, it becomes clear what’s actually important. In the long term, benefits will be a decisive characteristic of the types of companies that Millennials will want to work for.”
Holiday parties and snacks are nice perks and used to grab job seeker headlines, but now Millennials wisely appear to seek stability and benefits. In fact, what each generation now wants from an employer are core workplace benefits that truly help take care of people and their families. Crises only accentuate this fact, especially in these youngest of workers, such as Gen Z, who have not had to struggle through rough economic times before as adults. Dr. Denise Villa and I cover this topic and other important insights in our forthcoming book, Zconomy: How Gen Z Will Change the Future of Business—and What to Do About It.
Advisers must adapt to what tech-dependent investors demand
The world of investing has changed dramatically over the years and continues to do so as smartphone-based apps make financial decisions easier to research and execute. When it comes to Millennials and Gen Z, an adviser must be able to do more than set an in-person meeting or even a phone call with a client. Once that is done, the advice must meet the challenges Millennials and Gen Z face.
I told PlanAdviser, “Advisers who choose to adapt to how these workers communicate, and place benefits and emergency savings accounts higher up, will likely succeed,”
Currently, there are more than 33 million Americans out of work. Without a doubt, those who are entering the workforce or who have not yet established themselves in their field may find it especially hard to find a job in their career of choice—or any job depending on where they live and their skillset. The world of work will look very different to every generation during and after the COVID-19 pandemic.
As I mentioned in the article, “The truth is that nobody working right now has been through a situation like this before. We don’t want to just take a playbook that worked before and apply it blindly again. We need to take a step back and look at the uniqueness of the situation. Look at the uniqueness of the people going through this, and how you can best serve them.”
What are the key take-aways leaders need now?
As a leader, the pandemic has created a crucial time to update key generational management and insights-based actions to accurately reflect how each generation is experiencing this challenging time. Leaders need to understand what strategies and tools actually work now for remote workers of every generation and how to drive sales and marketing across generations.
At our research firm, we have already completed and are leading several new studies that inform what we teach leaders through our virtual presentations, interactive strategy sessions, and executive briefings. These virtual solutions fill in the insights gaps so leaders can quickly make smart, informed, research-based decisions to come out of the pandemic with momentum and with the clarity they need to succeed.
Contact my team here to learn how I can deliver our COVID-19 generational research and insights to help you and your organization lead, market, sell, and innovate through this challenging time to emerge stronger.
Posted: May 13th, 2020
Categories: Generations | Investing | Media | Millennials
Written by Jason Dorsey
Jason Dorsey is an acclaimed generations and behavioral researcher and speaker. He's received over 1,000 standing ovations for his unique keynote presentations. Jason has led over 120 research studies. Adweek calls him a "research guru." His mission is to deliver new insights and practical strategies that solve business challenges for leaders.
