Millennials Are More Likely to Spend on This Than Other Generations

What makes you happy? Would you rather spend your money on fancy gadgets, designer clothes, and luxury cars. Or would you prefer to travel to a new destination, try out different cuisines, or attend a concert? While the previous generations may have valued material possessions as a sign of success, millennials (born between 1981 and 1996) are quite different from other generations.

Experiences versus things

Unlike previous generations, millennials are more interested in acquiring experiences than possessions. They would rather spend money on travel, concerts, dining, and other activities that offer unique and memorable experiences.

This shift in priorities is driven by several factors, including the desire for social connection, personal growth, and adventure. In contrast, millennials are less interested in owning a house or buying a new car. They prefer to spend money on activities that create memories and stories to share with others.

The impact of social media

Social media is a major influence on the spending behavior of millennials. Members of that generation prioritize social value over material value when making purchases, with 61% engaging in experiences solely for the purpose of sharing on social media.

They are more likely to post pictures and updates about their experiences on social media platforms, which creates a sense of competition among their peers. This motivates them to invest in experiences that are unique and memorable. Also, social media has made it easier for millennials to discover new experiences and share recommendations with friends and family.

The role of the gig economy

The gig economy -- a flexible labor market characterized by freelance work and short-term contracts -- has emerged as a significant source of income for millennials. This has enabled them to earn money while pursuing their passions and interests, which often include experiences. They are more likely to invest their earnings in experiences than in tangible assets.

Impact on businesses

Millennials are now the largest generation in the workforce and are slowly becoming a significant driving force in the global economy. The unique spending habits of millennials, therefore, have significant implications for businesses that target this demographic.

For marketers, the secret to success lies in promoting sharable memories associated with their products rather than focusing on the product's material value. Since millennials place greater importance on the social value of a purchase than its material value, companies are adapting their products, services, and marketing strategies.

Enjoying experiences without breaking the bank

Although millennials are at the forefront of the experience-first movement, baby boomers are following suit. More and more retirees embrace the "less is more" outlook and prioritize relationships and experiences over material things.

As people continue to prioritize experience spending, how do we balance that with the need to save? It's all about being responsible with your money. The first step is to set a goal: Think about the experience you want and how much it will cost. Once you know the amount, start creating a budget tailored to your lifestyle.

Then, automate your savings with a separate account, such as a high-yield savings account, and schedule automatic transfers. High-yield savings accounts can offer competitive interest rates, allowing you to earn more on your savings over time.

If you are a responsible credit card user, take advantage of credit card rewards programs. You can earn points or cash back on everyday purchases, which can then be redeemed for travel purchases, entertainment, or even statement credits.

The spending habits of millennials are closely linked to their values and priorities. They prioritize experiences over possessions, and are heavily influenced by social media. Creating memorable experiences doesn't necessarily mean draining their checking accounts, either. Remember, saving for an experience is not just about the destination, but the journey as well. Stay motivated by sharing your progress with friends and family and celebrating those small milestones along the way!