Modern young people operate on a financial playing field that is very different when compared to the landscape experienced by their parents and grandparents. But as technology continues to dominate financial matters and economic forces place demands on wage earners from all walks of life; financial concerns facing millennials are actually quite similar to fundamental monetary priorities shared by past generations.
The major economic downturn experienced in 2007 was a wake-up call for consumers of all ages, but the turbulent conditions made a significant impression on Millennials, facing an uncertain financial future. If you are a young money manager reconciling market forces beyond your control, it is important to focus on the things you can change and improve. And while inexperience can work against you, your youth supplies a noted advantage, giving you plenty of time to navigate financial challenges on your way to prosperity. If you are like most millennials, however, the following concerns weigh heavily on your personal finances.
Strength of Credit
Creditworthiness is not built overnight, so it is worth protecting – particularly for young people with limited references. As you break from your parents’ finances, establishing your own accounts and references, it is vital to orchestrate a smooth transition – or face the consequences.
From your earliest credit interactions, reporting bureaus monitor and evaluate you behavior handling money. An introductory credit card, car loan, and mobile phone account can all be used to build credit, provided payments are made on time and the resources are used responsibly. Under less desirable conditions, the same credit opportunities can lead to catastrophic consequences, when inconsistencies arise.
You needn’t look much further than Brexit to see tangible uncertainty in Millennials future. In fact, the generation vocally opposes the prospect of losing their European identity, blaming the Baby Boomer generation for a series of financial missteps – leaving Millennials holding the bag. According to some young detractors, Boomers enjoyed decades of prosperity, before ruining the economy and passing-on a number of problems to the millennial generation. In this scenario, Brexit is seen by Millennials as the final chapter in a tale of financial mismanagement. Wherever you fall on the controversial policy, there is no-doubt an ambiguous future ahead for those affected by the controversial turn of events.
Educational credentials influence lifetime earning potential, so there is plenty of incentive for young people to earn advanced credentials. However, the cost of education increasingly falls on students and their families, creating struggles for those facing this extraordinary financial burden. Fortunately, government assistance makes school more affordable for UK residents attending local institutions, but ancillary costs of living add up quickly and some desirable degree programs are subject to substantial out-of-pocket costs. Emerging from higher education with unmanageable student debt is a genuine financial concern for millennials.
The underlying generational philosophy shared by many Millennials eschews the dot.com-type mentality responsible for past generations’ economic growth and prosperity. But while their income expectations may be realistic, stagnant wages are a concern for young people entering and trying to advance in a post-collapse economic environment. With a heightened sense of social responsibility and work/life balance, money motivation takes a back seat for many millennials, leaving young people wondering if their values synch with modern principles of productivity.
Real Estate Markets
Not all young people aspire to own residential real estate, but for those who do, the market presents less-than-ideal prospects for making the leap to home ownership. Affordability and inventory issues may not prevail indefinitely, but millennials are not likely to enjoy the same access to low-cost housing as did members of past generations.
Prevailing financial conditions continually evolve, reacting to economic pressure and other monetary influences. But while each generation encounters unique conditions, money managers of all ages face similar challenges. For millennials and members of other UK generations, reduced earning potential, shaky home-buying prospects, and general economic uncertainty are primary concerns.