Lessons Boomers Could Learn From Millennials
It’s not often that Baby Boomers take money advice from “20 somethings.” There is a tendency of older “wiser” folk to dismiss the views of a younger generation. However, Millennials may be able to teach Boomers some valuable lessons about how to manage money.
Spend money on experiences - not stuff
Instead of loading up on material goods, such as a big house or fancy car, Millennials are more likely to spend cash on intangibles. University of Colorado psychology professor Leaf Van Boven conducted a study in which he found spending money on life experiences, rather material possessions, is generally correlated with higher levels of happiness. On the other hand, the level of happiness associated with owning material possessions, such as cars, appliances, and televisions, depreciates over time.
Technology and sharing
The Millennial generation has quickly adapted to services like Uber and Airbnb to replace material possessions such as cars and vacation homes. By leveraging today’s technology, you can still have access to the same experiences.
Thanks to the sharing economy, people can, at a cost, rent everything from clothes to bikes through websites and apps. Plus, social networking sites like Nextdoor make it easy for people to connect with others locally and share goods like garden equipment or power tools.
There is a difference in how younger and older investors approach their investing. Again, technology plays a large role here. Nowadays, a person can hop on the internet and do research, which can make Millennials (a generation far more “plugged in” than their older counterparts) more engaged in the process of saving, planning for retirement, or investing in the stock market.
There is no shortage of apps and websites devoted to money management and wealth creation. However, unlike Millennials, Boomers may be hesitant to use these resources.
While Boomers may wait for someone to explain how technology is used, Millennials are willing to jump in and learn from experience.
Boomers may not be ready to take advice from 20 and 30 somethings, but those who are able to adjust to the Millennial way of thinking may find they come out financially ahead in the end.
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