Millennials tend to shy away from tracking their finances, but that’s not stopping many who have become homeowners from socking away money for a rainy day. Varo Money, Inc., a banking app directed toward millennials who utilize “hands-off” budgeting, recently surveyed 287 creditworthy millennials on their financial aspirations, their use of credit, and their everyday routines with money.
Forty-one percent of millennials with an income over $30,000 own their own home, according to Varo Money’s Deep Dive Millennial survey, and 27 percent of that group say they spend part of their monthly earnings on a mortgage. Only 8 percent of millennials who make less than $30,000 annually have a mortgage.
The survey found that these hands-off millennials are working full-time, well-paying jobs, but more need to implement better ways of managing their lives financially. Most respondents keep track of their finance simply by monitoring their bank balance, but this can backfire when unexpected events and spending spikes occur. Here are some of the highlights from the survey.
Millennials are worried that they can’t attain the same goals as previous generations.
- Following their passions (66 percent), traveling the world (42 percent), and getting married (40 percent) were the top three hopes respondents revealed.
- 52 percent reported having a “cash trap” in the last three months, which means they’ve had to dip into savings or borrow money to survive until their next paycheck
Many don’t have a detailed budget.
- 78 percent rarely or never make spreadsheets for finances; 35 percent say they’d “rather vomit” than do so.
- 80 percent check their bank balance at least once a week.
- 69 percent spend mostly or always on their debit card.
Most hands-off millennials are consistent savers.
- 50 percent of respondents move extra balances in their checking accounts into savings.
- 24 percent have a percentage of their paycheck automatically put into savings accounts.
Most respondents responsibly and actively use some form of credit.
- 92 percent of respondents have at least one credit card.
- Of those with credit cards, 72 percent carry a balance from month to month.
“There’s a stereotype that hands-off customers—people who aren’t super involved in the details of their spending—don’t care about money and don’t think about the future, but it’s simply not true,” says Colin Walsh, co-founder and CEO of Varo Money. “They’re focused on a future that’s often one year out and are looking for ways to pay down debt faster and save more automatically without having to track every penny in a spreadsheet.”
Source: “How to Cover Expenses, Build Savings, and Get Ahead Without Ever Making a Budget,” VaroMoney.com (June 9, 2017)
