We hear terms like Millennial, Generation X, Generation Z and so on thrown around a lot when it comes to lifestyle choices.
But how accurate are the characteristics of each generation for determining how they’ll respond to real-world concerns?
I’m talking about the difference between smashed avo and financial planning.
Turns out, each generation really is unique, and embodies certain characteristics determined by how and when you grew up.
IOL has published the findings of a study that looks into the generational personalities that determine how we manage our finances.
Here’s how when you were born might influence how you invest in your future:
THE SILENT GEN/ BUILDERS: born 1918-1944 (in their 70s, 80s and 90s)
The Silent Generation is known for making the greatest strides in terms of wealth, education and longevity, of any generation.
The Silent Gen typically stayed in the same job for 40 years to get that coveted gold watch. They adopted a very disciplined approach towards their work and careers with a high level of respect for authority. The same approach applies to their investing style: they tend to follow the advice of “experts”, pick an investment portfolio and stick with it.
Having grown up during the Great Depression (1929 to 1933) and World War II (1939-1945), they’re known for their frugal approach to spending and traditional values like loyalty and hard work.
THE BABY BOOMERS: born 1945-1964 (in their 50s, 60s and early 70s)
Unlike other generations, Baby Boomers tend to prioritise saving for retirement. This generation places high importance on work and respect in the workplace.
Like the Silent Gen, Boomers tend to have a buy-and-hold mentality. Additionally, Boomers’ “my home is my castle” mindset means many have invested in property.
Unfortunately, despite earning the equivalent of twice what Millennials earn now at the same age, they haven’t turned out to be the best savers, and many Baby Boomers have started side hustles to supplement their retirement savings.
GENERATION X: born 1965-1980 (in their 40s, and early 50s)
X-ers grew up in homes where dual incomes were becoming the norm.
With a “yes, we can” approach, this generation became synonymous with mass consumption, Wall-Street levels of opulence and “Keeping up with the Joneses” aspirational lifestyles.
GENERATION Y – AKA MILLENNIALS: born 1981-1996 (in their 20s and 30s)
By 2020, Millennials will make up half the workforce. They are motivated by meaning, experiences and avocados, with a drive for self-development.
Millennials are also faced with the prospect of ongoing “black tax” as South Africa’s rising unemployment rate (currently officially over 27%) requires those with jobs to support a wider family of those without. This has been exacerbated by the cost of tertiary education with most Millennials required to pay back student loans.Impact investing has increased significantly, with Millennials choosing to invest according to their values. Additionally, they are the first generation that is likely to completely overcome significant home bias, becoming true global citizens.
GENERATION Z: born 1997-2018 (in their infancy, teens and early twenties)
This generation cannot be fully defined, especially because a number of its members are still in infancy. What we do know is that they are highly tech competent and very good at multitasking. Social media is a very important part of how they interact with each other and the world.
The Gen Z investing style will be revealed once this generation comes of age. That said, the growth of the “gig economy” could have interesting consequences for how they navigate finances.
As you can see, every generation is different from the one that came before it, so it’s important to understand the traits specific to your generation and have an honest conversation with yourself about finances.
Better yet, take some advice from the Silent Generation and have a conversation with an expert.
Consequence Private Wealth partners with you and your family to protect and build your wealth. They believe that the consequences of decisions made today will bear fruit over the years, based on the sound principles applied at their inception.
Bringing in experts, like Consequence Private Wealth, can help you to make the best possible decisions.
After all, you don’t want up having to rock a side hustle in your later years.
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