Gen Y are tipped to be the biggest spenders this Christmas, but they’re becoming increasingly savvy about how, and why, they do it, says a comprehensive new nationwide study.
These are just some of the striking findings of the Choosi Dollar Report, the second by the life insurance comparison site and CoreData in a series that investigates generational shifts, barriers and drivers of our financial and social behaviour.
Gen Ys (35 years and younger) intend to splurge $678 each on Christmas food and drink, $128 more than Gen X (36-50) and $202 up on the average outlay by the 51 to 70-year-old Baby Boomers, says the report.
Close to three in five (59.3%) say they have a dedicated festive season savings account, while 13.4% plan to use their end-of-year bonus for their Christmas spend.
Gen Y are also most likely to be taking a holiday this Christmas/New Year, and most commonly intend to use their savings for it (48.8%).
Produced by Choosi
Although lacking some of the confidence of older generations when it comes to how and where to spend their money, the study reveals that Gen Ys are catching up fast, thanks to their resourcefulness and confidence online.
They are the age group most likely to regularly research information to help them make financial decisions (47%), have documented financial goals (45%), and have tricks or habits to motivate themselves to save regularly (42%).
Almost two thirds (59%) of Gen Y respondents cited social media as the reason for their improved understanding of finance and the economy.
The study finds that ‘Keeping up with the Joneses’ to be another motivating factor when it comes to Gen Ys paying closer attention to money matters.
Overall, nearly seven in 10 (69.2%) respondents believe that it’s now trendier to be seen as financially savvy in Australia today, with Gen Y feeling the biggest pull in this area (73.4%).
Close to three in five (56.8%) say this has been brought about by society becoming more materialistic. Similar proportions also claim being ‘money smart’ is seen as trendy because this suggests one is affluent and smart (35.1%).
Even so, Gen Ys are still the most likely to feel their finances are a bit out of control sometimes (62.9%).
However, they are also the most likely to say they do not worry about financial security, as long as they keep working (58.0%).
“Clearly, there is a gulf between intention and action and while Australians may feel they’re more knowledgeable than ever before when it comes to money matters, applying this knowledge is critical for ensuring financial security,” concludes the report.
“The great news is that reliable and realistic financial information is more accessible than ever before. Already proving they have the right mindset to navigate the challenges of personal finance, taking affirmative action and applying a bit of common ‘cents’ will see Aussies moving towards a brighter financial future.”
For more detailed information on the research, you can read a fascinating blog on the Choosi website here.