Fairness aside, millennials almost always get a bad rap when it comes to money and personal finance. Either they're considered too entitled or too lazy to learn more, both of which are stereotypes viewed as grave mistakes that'll cost them big later in life. However, there is one specific area most young adults and data analysts alike can agree upon: Millennials have mastered the art of saving early, according to CNBC.
New research gathered from Merrill Edge states that 66 percent of surveyed participants believed their savings accounts alone will be sufficient enough to rely on in 20 years.
In fact, more than half (54 percent) said they'd be willing to "cut back on going out" if that meant saving larger amounts over time.
This is a stark difference when compared to older generations, who when asked the same question, showed a preference for depending on "outside sources." While 71 percent of Gen Xers listed their 401(k) account, 54 percent of baby boomers reported pensions and 50 percent chose Social Security.
"Uniquely shaped by their coming of age during the Great Recession, millennials appear determined to achieve their future goals with their 'do-it-myself' attitude," head of Merrill Edge at Bank of America, Aron Levine, wrote in the report. Playing it safe, millennials would rather take on the responsibility of monitoring and allocating their funds themselves than risk losing money because of another financial crisis. Fair enough. That same attitude applies when it comes to buying a house, getting married, and having children, Merrill Edge concluded.
Although investing a.k.a putting your hard-earned cash in someone else's hands might be a terrifying topic, it's one of the greatest ways to acquire wealth. And wealth, ironically, is what millennials seem to want the most from working, according to strategy firm Department26. For example, a 25-year-old who earns $50,000 could potentially flip an initial $5,000 plus $2,500 a year into $465,000 at age 65. That's based on an eight percent rate of return and only five percent of their annual salary. Seeing that Generation Y already has saving covered and its sights on long-term success, how to invest then beings with picking a lane and creating an effective budget.
If you're among those interested in financial planning and want a complete rundown, we suggest visiting Refinery29's handy investment guide. Making decisions, whether you enter the stock market or not, is a part of the process and will ultimately put you closer towards reaching your dreams.