Millennials young but not dumb or broke

Millennials get a bad rap for being irresponsible with money and are frequently accused of frivolously spending on smashed avocado and soy lattes instead of saving.

But new Bank of New Zealand research has revealed a very different picture, showing that more than 70 per cent of millennials say they are carefully planning for their financial futures, while almost three quarters of 18- to 24-year-olds have set financial goals.

The survey of more than 2000 Kiwis also showed half of millennials want to save more next year.

Jess Nelson was among youngsters showing good financial smarts.

The 22-year-old’s father passed away when she was 12, leaving her and her brother some money. The pair, along with Nelson’s partner, put the funds towards a deposit on a house in Palmerston North last year.

“There’s plenty of time to travel but houses are just going to get more expensive. It’s a long-term investment,” Nelson said.

Nelson works two part-time jobs, on top of volunteering at her local hospice shop, to help pay off her mortgage and save towards renovations. Nelson and her partner have also taken on a boarder.

She said the bad reputation millennials had for frittering away their money wasn’t fair.

“It’s the same with any generation. There have always been people who have not wanted to do work or not wanted to save . . . but there are a lot of people who are wanting to work hard and save and get places.

The research also found many millennials plan to buy a home, but instead of saving for a deposit they are putting their money aside to travel overseas, go on holiday or buy a car.

“Millennials are motivated to save but just by different things. When you’re in your late teens and early 20s you have a different set of financial priorities and plans than older people,” said BNZ’s director of retail and marketing Paul Carter.

Carter said it had become more expensive to buy a home, meaning people needed to give it more thought and planning than they used to.

He said the trick to saving was to set up two pots — one for short-term goals like an overseas trip and the other for a future home or other investments.

Almost 70 per cent of young people also said they have the capacity to save some money and almost a third were motivated to make a budget and stick to it.