91% Millennials believe in making their own financial decisions & aspire to invest in Real Estate
Millennials are by far the most redefining generation to have appeared over the past five decades. Several traits drive their lifestyle choices, not least among them being a much higher acceptance of diverse lifestyles than previous generations. However, millennials have also displayed a decisive return to conservative behaviour and choices. In a clear departure from the adventurousness and even rebelliousness of their preceding generations, millennials show a marked tendency towards traditional values.
Especially in India, millennials see a good education as very important in achieving their life goals, and will diligently pursue a degree in their chosen academic fields. They consider loving and respecting their parents as a very desirable trait, will conscientiously avoid putting their health at risk with vices, seek to have stable marriages and will bring their children up with the right kinds of values.
Because stability is such an important factor for millennials, owning a home earlier rather than later is a given for them. The previous generations often gave less weightage to this very important ingredient of financial and emotional security, choosing to live in rented homes and using their funds to play the market.
At 440 million, millennials form about 34% of population of India and 46% of the workforce. A force to be reckoned with, they are also a paradox beyond parallel in the personal finance space. Renting is preferable to purchasing, be it a car or a house or office space, but buying a house is still the biggest aspiration. Parents are not to be heeded generally, unless they push them constantly.
Most millennials are not thinking long term and it is probably a function of their age and lifestage. In the 20–35 year age bracket, they are single for a long period, have less responsibilities and are spending-oriented. Hence, have a short-term view.
Unlike Gen X, who started saving for their long-term goals — house, children’s education and weddings, retirement — the day they started working, Gen Y puts these off for later. What they are focusing on instead are cars, vacations, smartphones and electronic gadgets, not necessarily in that order.
Among long-term goals, buying a house is the biggest aspiration for millennials, as per the BankBazaar survey, Aspiration Index 2018 — Decoding Indian Millennials, among 1,551 people in the 25–35 age group. Hence, investment in real estate is always sort after.
Amongst millennials there are 3 types — One, who will do exactly what their parents tell them to and invest mostly in conservative instruments. Two, the independent ones who will try out new things, but will also talk to their parents and invest in traditional avenues. Three, the complete rebels, who will not listen to their parents and even invest in bitcoins.
While millennials are generally seen as the “high on risk” generation, they don’t seem to exhibit that when it comes to financial planning, according to a report by BankBazaar, ‘Aspiration Index 2018 — Decoding Indian Millennials’.
While 91% of millennials believe in making their own financial decisions, only about 56% invest in instruments like mutual funds, said the report. In comparison, 57% of them invest in fixed deposits, a preferred instrument for risk-averse investors, and 36% in Provident Fund and Public Provident Fund accounts.