Millennials are the least likely to plan ahead, according to the issue brief. Compared with other generations, they were less likely to save for retirement (40 percent) or to have savings in a “rainy day fund” (33 percent). The brief acknowledged that given their age and their lower household income — 65 percent have an annual income less than $50,000 — that isn’t very surprising; however, there are several other indications that millennials need help financially.
Almost a quarter of millennial respondents said they spend more than their income, and 31 percent have unpaid medical bills. Almost two-thirds have a credit card, and of those, more than a third have engaged in at least three “costly credit card behaviors” over a 12-month period, such as paying only the minimum, incurring late fees or taking cash advances.
The brief pointed out that one of the difficulties in working with millennials is that they are a diverse group. Almost half of respondents are minorities, compared with 26 percent of boomers and 9 percent of the silent generation. Within their generation, only 20 percent of young millennials (age 18 to 26) are married and almost a third have dependents, compared with 36 percent and 45 percent respectively for the generation as a whole.Millennials are also the least financially literate generation. Less than a quarter were able to answer four or five financial questions correctly in a five-question test. By comparison, 38 percent of Gen Xers, who are similar to millennials in a lot of behaviors, were highly literate; 48 percent of boomers and 55 percent of the silent generation were highly literate.