Millennial independence is changing our world
July 7, 2016
As the United States celebrated its 240th year of independence, people all across the country marked their freedom in a variety of ways: barbecues, fireworks, parades and however else they chose. Naturally, because that’s freedom! As for some of our younger fellow citizens, the millennials, they’re seeking new and expanded freedoms. With many experts predicting that millennials will make up 75 percent of the global workforce by 2025, these freedoms will likely shape our economy, our country and our world irreversibly.
Financial freedom
Every generation struggles in their 20s and early 30s to gain financial freedom. Like the Silent Generation (those born in the mid-1920s to the early 1940s), millennials were dealt an unfavorable hand — the former generation beginning their careers during the Great Depression and the latter in the Great Recession (another name for the financial crisis of 2007-08). So what does financial freedom mean to the average millennial?
The first and probably the most obvious is to get out of student debt. Millennials are strapped with the highest student debt in history at a time when the job market has made it tough to pay it back. According to Cappex, a website connecting students to colleges and scholarships, the college graduate class of 2016 carries an average of $37,172, the all-time high mark. Not surprisingly, millennials are debt-averse.
After living through the dotcom bubble and crisis, and watching parents, grandparents and others lose their homes and savings, they’re also wary of Wall Street. As Jessica Lynn Rabe, a market strategist and millennial, wrote in Investmentnews.com last year, “… my friends are more willing to bet on sports than stocks.”
Yet millennials will soon be on the receiving end of the largest transfer of wealth in human history, as $59 trillion is shifted from 93.6 million American estates through 2061. What will millennials do with that money? Invest? Give to charities? Start their own businesses? Many millennials would rather pour their money and their sweat equity into entrepreneurship.
Workplace freedom
In the 2016 Deloitte Millennial Survey, 70 percent of millennials say they may reject traditional business in order to work independently. Sixty-six percent say they expect to leave their current employer in the next four years. Clearly, this generation doesn’t want to work for “the man” — or in one place for long — and generally rejects rigidly hierarchical offices. The freedom they crave is to create their own schedule, which has given rise to the sharing economy: Uber, Airbnb and the like. One big reason for all of this is because, more than other generations, millennials prefer purpose over profit. When corporate values match their personal values, millennials are more satisfied and more loyal to their employers (and products!).
This flexibility that they crave isn’t just limited to schedules and organizational charts. The formal workplace attire has grown even more casual. They’re incentivized differently because they also prefer experiences over money. Getting an extra week of vacation over a monetary bonus is more attractive to millennials than past generations. In fact, many millennials —and not just this generation — would rather telecommute from home or a coffee shop than sit in a cubicle or office all day. Technology, which may still seem newfangled to older generations, but which millennials have grown up breathing like air, has made that possible.
Freedom of expression
Americans are a freedom-loving people, and with social media we are empowered to freely express as the inclination strikes us to hundreds, thousands, perhaps millions of others in an instant. Millennials are more adept at it and more prone to do so. When they like something, don’t like something or anything in between, they tell the world about it. This has been a game-changer. Before, a purchase was a business transaction. Today, it’s a relationship. Successful relationships require a lot of wooing and a lot of work. Companies that don’t get this stand to lose a huge customer and employee base.
Jennifer Pagliara is a financial adviser with CapWealth Advisors. Her column appears every other week in The Tennessean. For more information, visit www.capwealthadvisors.com.
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