Millennials smash the avocado spending myth

MILLENIALS are mixing savings with their smashed avocado and busting the popular myth that they are financially irresponsible.

New research suggests that Australians aged in their 20s are saving more of their cash – outside of superannuation – than any other age group, and a house deposit remains their top target.

Almost two thirds of Australians born in the 1990s started saving as soon as they began working, and more than half are saving up to 20 per cent of their income, according to Pureprofile research commissioned by Millennialsfocused investment company Spaceship. Almost one in five are saving 30 to 40 per cent of their income.

Spaceship chairman Andrew Moore said the image of Millennials choosing smashed avocado over savings had stuck in recent years but was not warranted.

“Young people maybe don’t follow the more traditional path of university, job and family the way they used to,” he said. “That has given them more time to travel, and it’s true that young people do spend more on travel than previous generations.

“But it’s also true that young people spend less on food and alcohol, and more on housing. That sounds responsible to me.”

Mr Moore said Millennials were savvy about saving in new ways. “They’re on top of the neobanks and the savings accounts that neobanks bring with them, and they’re increasingly using microinvesting apps and other modern products to stash away their money.”

The survey of more than 1000 people of all ages found that a house deposit was the most popular savings target for people in their 20s, ahead of buying a car and travel.

Omniwealth senior financial planner Andrew Zbik said he had found many of the people who criticised Millennials’ spending choices might have benefited from free uni tuition.

“A lot of Millennials are leaving university with HECSHELP debts and are seeing up to 8 per cent go to their debt repayment,” he said. “On top of that they are saving money, so when you put that into context it’s quite impressive.”

Mr Zbik has noticed more clients are also accessing the government’s First Home Super Saver Scheme.

“They are of the mindset that there’s going to be no age pension, and it’s up to them (to save),” Mr Zbik said.