ABA Banking Journal - May/June 2016 - (Page 26)
Bringing Millennials into Banking
Millennials are not disenchanted with banks, they
just are not ready for the products that brought
previous generations into the banking system.
31 are married and own a home. Major life decisions
like starting a family and buying a home are exactly
what brought previous generations into banks.
Millennials have had a rough financial start. More
millennials are going to college than any previous
generation. Although this is good, many are taking on
debt to do so. In fact, 75 percent of graduates today
have student loan debt, averaging $29,000.
Despite this slow start, millennials want the same things
as previous generations, just on a slower timeline. Studies
show that 93 percent of millennial renters plan to own a
home someday and 74 percent want to have children.
At the same as they are taking on this debt, their earnings
prospects are diminished. Millennials have entered
the workforce in a period that has seen two historic
recessions. With higher debt and lower earnings, it is
no surprise millennials' finances are a bit shaky.
Because of their finances, millennials are delaying
major life events. Just 23 percent of adults aged 18-
In order to accomplish this, millennials need first to rebuild
their finances. This is exactly where they need banks' help.
Banks can leverage technology to deliver innovative
products that help rebuild millennials' finances. If they are
able to do this, when millennials are ready for mortgages
they will turn to the banks that helped them get there.
ROB MORGAN is VP for emerging technologies at ABA.
What Makes Millennials Different?
T o help understand some key trends about what
millennials believe and why it matters for banks, we asked
Kristen Soltis Anderson, a pollster and expert in millennial
public opinion and behavior, to highlight some top trends.
On skepticism of received wisdom
about the good things in life
It's a generation that's a little more commitment-phobic than
previous generations. The idea of making a commitment to
anything that will last more than the next week is an anxietyinducing proposition for many. A lot of the things millennials
were told were the responsible commitments to make-whether
that's to commit to getting married, starting a family and settling
down; to commit to going to college and getting a degree; to buy
a home; to invest in the stock market-have turned out in the
minds of many millennials to be less of a good deal than they
were sold. So they're a little bit skeptical when they're told "You
should do this because it's the smart, responsible thing to do."
ABA BANKING JOURNAL | MAY/JUNE 2016
On valuing family and striving for success
On the other hand, they're pretty optimistic and creative,
and they want to be able to blur the lines between their
personal lives and their work lives. The lines between
work and play have blurred a lot for millennials, and that's
something for people who work in the financial sector to
know. At the margins, you're seeing a slightly different set
of values when millennials ask, "What does fulfillment in
life mean to me, and how can I make my career support
that?" Family is hugely important. It's defined a little more
flexibly than previous generations, but this is a very profamily generation. This is a generation that puts a lot of
pressure on themselves-you've got to thrive at home, you've
got to thrive at work and you've got to put it all together.
KRISTEN SOLTIS ANDERSON is a co-founder of Echelon Insights, a
columnist for the Washington Examiner and the author of The Selfie
Vote: Where Millennials Are Leading America.
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ABA Banking Journal - May/June 2016