How are millennials spending their money?
Some insights on their habits and tips to save money.
Have you ever wondered who falls under the category of millennials? Well, CNN suggests that anyone born between 1980 and 2000 are part of this generation. People often mention that millennials are less likely to prioritize savings compared to other generations. So what are millennials spending most of their money on? Millennials may be spending less, but their budgets are mostly dedicated to non-essential purchases. This says a lot about their consumption habits. It may come as a shock to some, but it makes sense why millennials spend most of their money on coffee, eating out, transportation and technology. Instead of caring about ownership, millennials are more interested in experiences. It is important to make note of your spending habits and keep track of the categories you spend most of your money on daily.
Did someone say coffee?
I’m a college student who runs on caffeinated drinks. I try to limit myself to one cup a day, but sometimes I can’t stay away from drinking more. The New Web surveyed millennials and found that 60% spend more than four dollars on a cup of coffee per day. In comparison, only 29% of baby boomers buy their daily dose of the caffeinated drink away from home. Fancy or hipster coffee shops are the ultimate fad for my generation. How many times have you walked by someone holding a decorated to-go cup and wondered where they got it from? I get it, I like the stylish cups and fancy drinks too. Surveys have shown that millennials spend more money on coffee than they save for retirement. Investing in a coffee maker and a pack of ground coffee beans will help save those four dollars a day — that’s $1,460 per year!
Eating out is a way of life
Not to toot my own horn, but I’ve been told that my homemade mac-n-cheese is mouth-wateringly delicious. Even though I love cooking, nothing will compare to eating out. Living in New York City and not indulging in the food culture is difficult, while cooking at home can be tedious and time consuming. How can you resist going to the new ramen place next door or to your favorite pizza joint? According to Forbes’ article, on average, millennials dedicate 44% of their budget on eating out or ordering in. Grubhub and Seamless are quick and easy ways to order food right to your door. Stepping out of your house and into a different environment can be a good stress reliever. Socializing is linked to eating out with friends and enjoying restaurant culture.
One way to save money without missing out on the dining experience is to make a plan with friends beforehand and check out the menu prices. Don’t feel shy to say if it’s a bit too pricey, someone else will probably be thinking the same thing.
Uber all day, everyday
Mobile apps have completely changed transportation. It’s so easy. One, two, three and within minutes you are on your way. There are a slew of mobile apps that millennials use to order rides. Business Insider found that roughly 30% of millennials are using Uber. According to Vice, San Francisco, Chicago, and Seattle are the three major cities in the US with the most Uber usage. These statistics only account for Uber, excluding all of the other apps that millennials may be using. Purchasing a car or bike is an investment, but if you find yourself ordering Ubers all the time, then it may be worth it. In nicer weather, a bike ride or walk can be a fun, healthier commute experience too!
Can’t stay away from the latest technology
Are you one of those people who want the newest version of the iPhone as soon as it’s available? You’re not alone. Techcrunch released that US consumers spend roughly five hours a day on their mobile devices. We are so attached to the digital world, that every time a new technological device comes out, millennials are willing to spend their money on the product. Innovative technologies are more than just a purchase. The user-experience is what millennials are buying. Technology is an integral part of everyday life, and creates the experience that millennials crave.
I definitely won’t stop eating out or using Uber, but will actively keep an eye on my non-essential spending. Consciously thinking before you spend can save you a lot of money in the long run. Every time you feel the urge to splurge on an extra cup of coffee, fancy dinner, or an Uber ride, think about whether there are equally fun or convenient alternatives that can save you money.
As a matter of fact, N26 in Europe offers an expense categorization feature that makes it easy to track spending on restaurants, shopping and rides. There are other apps, like Digit or Acorns that help millennials manage money.
Join our waitlist and when N26 comes to the US, saving money will be simple and easy.
