Millennials Have New Financial Competition; If You’re a Millennial, You’re a Walking Fraud Target; and Why Overspending on Your Retirement is a Terrible Idea
Millennials Have New Financial Competition, Upcoming Generation May Outshine Them
Every generation has its own pros and cons, and their own set of unique issues, but when it comes to finances, Generation Z might be in a far stronger position than millennials—at least, in Canada.
A newly released Canadian study shows that 63% of Canadians born in or after 1995, are credit active, and 99.8 percent of those own a credit card.
By comparison, only 50 percent of United States Generation Z consumers own a credit card. Coming in second and third are student loans and personal loan products.
Matt Fabian, director of financial services research and consulting at Transunion Canada told Yahoo Finance Canada the following:
“Credit cards are the entry point for the Gen Z generation because they are the easiest to get from a qualifying credit perspective.”
David Fortin, a portfolio manager for Canadian investment app Mylo, notes, “We find that Gen Z are more responsible with their credit card usage, having a lower balance as a percentage of their income.”
He also noted that “Gen Zs are more aware about how tax-saving efforts can help their financial freedom,” and “Being more socially responsible can translate into good behavior financially.”
If You’re a Millennial, You’re a Walking Fraud Target
Watch out, millennials. Growing up in the age of the internet comes at a cost, and the price means being uniquely positioned as a target of internet scams.
An October 2019 report by the Federal Trade Commission found that millennials are 25% more likely to report losing money to fraud than people over the age of 40.
The report also found that millennials are twice as likely to report being victimized by shopping fraud, falling for debt relief and business scams and that they’re 77% more likely than older consumers to lose money from an email-related scam.
Why Overspending on Your Retirement is a Terrible Idea
When it comes to saving for retirement, millennials might be overdoing it a bit. Priya Milani, founder of Stash Wealth, a financial firm in New York City, she believes many of her clients are doing just that.
“Oversaving is pretty easy to do when you’re a high earner,” said Malani. “The potential issue with over saving for retirement is that if you’re saving in an arbitrary fashion (without any real goal in mind), you’re likely compromising on the goals you probably want to accomplish between now and retirement.”
In other words, while it is important to start saving, and the earlier the better—you should strive to keep a balance between the lifestyle you hope to obtain someday, and the one you have now.