Millennials Are Ruining The Economy.

Today, I react to an article saying that Frugal Millennials Are Ruining The Economy - Enjoy! Add me on Instagram: GPStephan

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The Article

Well, here’s my take on it…as a millennial…who saves a LOT of money.

If people are making less money, it causes them to be hyper-focused on getting the best value possible - and being incredibly selective about where they spend their money, when they DO decide to spend it.

But there’s also another interesting perspective…the Chief Financial Analyst from Bankrate believes that, because the Great Recession happened during a financially formative time for many millennials, they don’t have the same spendy consumption mentality as previous generations.

All of that caused SAVING to be at the forefront of our minds, even if it’s just out of an abundance of caution…not to mention, there’s recently been a strong cultural push towards minimalism, frugality, and financial literacy.

So given all of that, is it TRUE that millennials are to blame for the sluggish economy? And…the answer to that is….YES…and also, a NO.

It’s no surprise that our economy DOES benefit from a surplus of spending...the more money that gets spent, the more it circulates throughout our economy, and the more the entire economy can grow. When the spending stops, that’s bad for business…and bad for growth…

However…if people aren’t spending money…it has to go somewhere. And in this case, the more people are saving - generally, speaking - the more money they can INVEST. This money goes back into businesses, which can use it to further innovate and adapt…which, again, winds up back into our economy...improving it on a macro scale.

So as long as people aren’t just saving all of their money under a mattress…a higher personal savings rate can be BAD for certain business, GOOD for our economy, and GREAT for the individual who’s able to save more - if it means they can invest it.

And overall, based on the original article that brought us here in the first place…I think we ARE seeing signs of a cultural shift AWAY from reckless spending, and into an era of more thoughtful, impacting purchases.

Millennials want more value, we want lower prices, we want more flexibility, and we’re willing to consume less - overall - to get it. And even though we’re getting paid less, and our expenses are going up beyond belief…how we chose to spend our remaining money not only says a lot about us, but where society is going in general…which is placing a stronger emphasis on saving money, living below our means, increasing our credit score, being smart with our money, and smashing the like button.

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