Hop over to Google and type 'millennials are' and the search engine may suggest 'lazy' as one of the autocompletes. Those between the ages of 18 and 34 can sometimes get a poor reputation among older generations. But the Discover Savings Survey has shown that they're certainly not lazy when it comes to saving for the future, as they outperform both Gen Xers and baby boomers.
In a study of the savings habits of 2,205 adults, the Discover Savings Survey finds that:
of millennials are saving in some capacity
of Gen Xers are saving in some capacity
of baby boomers are saving in some capacity
Look a little deeper into the millennials' savings habits and you'll find they are more likely to save for specific goals—like a much-needed vacation, car repair or holiday gifts—compared to older generations:
of millennials are saving for something specific
of Generation Xers are saving for something specific
of baby boomers are saving for something specific
Not only that, but millennials saving money are the most likely to have increased how much money they are saving in the past 12 months:
35%of millennials saved more in 2017 compared to 2016
25%of Gen Xers saved more in 2017 compared to 2016
22%of baby boomers saved more in 2017 compared to 2016
So, when it comes to being prudent with their cash, millennials' savings habits appear to be on the right track.
The survey reveals that of the 77 percent of people who are currently saving, nearly half (48 percent) do so through more than one savings product. A savings account in combination with a checking or retirement account were some of the more common combinations. Among respondents, 41 percent of those using a savings account also use a checking account, and 34 percent of those using a savings account also use a retirement account.
The savers out there are making use of a variety of financial products to support their savings habits:
While any sort of saving behavior deserves kudos, growing your savings over time is a key ingredient to financial success. A good portion of survey respondents saved more money in 2017 compared to the year prior, but each generation gives different reasons for the increase.
Many millennials saving money (40 percent of those who ramped up their savings in 2017) say a better understanding of how to set up a budget was the key to boosting their savings habits, while cutting out a recurring luxury expense helped 26 percent sock away more funds.
If you've been considering the merits of your pricey gym membership versus picking up running or using an at-home yoga video, a fatter bank account is perhaps a good incentive to ditch the club.
Meanwhile, the improvement in the savings habits of Generation Xers who saved more money in 2017 came from a paycheck bump for 32 percent. Twenty-six percent either nixed a recurring luxury expense or benefited from a better understanding of how to set up a budget.
Equal numbers of baby boomers who increased their savings in 2017—20 percent for each factor—cite improved savings habits as a result of a paycheck bump, a better understanding of how to set up a budget and cutting a recurring luxury expense.
It takes some real discipline to be a saver. The Discover Savings Survey provides insights into how consumers across generations try to save their money.
While dining in was a favorite across the generations, other ways of curbing spending vary by age group:
For those already on the savings bandwagon—older generations as well as millennials saving money—39 percent say they hope to save $4,000 or more over the next year.
How do your savings targets compare? Click an option below to see what percentage of consumers share your savings goal:
Despite the fact that many consumers are proactively saving for their future, nearly a quarter of consumers still aren't saving anything at all. Even more surprising? Seventeen percent of those non-savers couldn't tell you why. As it turns out, not having a reason is the second most common response among those not currently saving. Another 17 percent cite everyday bills as the culprit behind their lack of savings habits. Too many debts to tackle holds back 10 percent of those not saving.
Less surprising may be the main reason respondents say they aren't saving—not having enough spare cash. Here's the rundown from the Discover Savings Survey:
I don’t make enough money to save
I have everyday bills that need to be paid (i.e., housing, utilities)
I have too many debts (credit cards, student loans, etc.) that need to be paid
I lost my job or had another unexpected financial setback
I don’t know how to save properly
There's no value in saving
Some other reason
I'm not sure
Among those who are not saving, nearly half (47 percent) are unlikely to start saving in the next six months. Even if they were to start saving, 35 percent of people didn't know which type of account they would use to save their hard-earned money.