Why Everything You Know About Millennials and Money is Probably Wrong
Do you have credit card debt? How about a savings account? Which one is bigger?
A new Bankrate survey asked just that. And while Bankrate would lead you to believe our financial security is in dire straits, we’re pretty impressed with the results.
While you’re tallying your own balances, here’s what Bankrate found.
If You’re in This Group, You’re Going to be OK
The results of Bankrate’s Financial Security Index survey were more optimistic than one might expect.
Of those Bankrate surveyed, 52% reported having more emergency savings than debt.
Meanwhile, 24% of respondents said they had more debt than emergency savings.
While Bankrate and others who have commented on the survey might indicate we’re all going to die surrounded by everything we bought with our credit cards, it’s really not as severe as as they make it out to be.
More than half of those surveyed are OK! They have more in emergency savings than they owe to anyone. Isn’t that something to cheer about?
Bankrate reports 17% have no debt and no savings, which is a little terrifying, but… I’ll say it’s better than being in debt, right? There’s room to grow.
Stop Blaming Millennials, Please and Thank You
Bankrate notes that millennials — defined as ages 18 to 36 — are the worst about having more credit card debt than savings.
Still, only 29% of millennials surveyed more credit card debt than savings — for Generation X, the number was only slightly lower at 26%.
Meanwhile, a pretty even percentage of millennials, Gen Xers and baby boomers have more savings than debt. Why can’t we quietly celebrate that similarity instead of claiming that millennials are “most in trouble”?
What to Do If You Have More Debt Than Savings
If your emergency fund doesn’t stack up, don’t feel bad. Start making plans to fix it.
If you’re in debt, you have two options: pay down your debt before you focus on building your savings, or save while you pay your debt. The former can be tricky: If you run into a financial emergency with nothing in reserves, you could end up in more debt.
If you’d like to save while working on your debt (good for you!) we have a guide for building up your emergency fund.
If you want to make progress on your debt first, read these 13 creative ways to get out of debt to get motivated.
Either way, you’ll be making smart money choices. You’ll thank yourself later.
Your Turn: How does your emergency fund compare to your debt total?
Lisa Rowan is a writer and producer at The Penny Hoarder who is getting tired of being told she’s doing money wrong just because she’s a millennial.