millennials in 2015: financial deep dive - nielsen · 2019-05-29 · 30% college graduates, 11%...

1Copyright © 2015 The Nielsen Company

M i l l e n n i a l s i n 2015:F i n a n c i a l D e e p D i v e

2 Millennials in 2015: FinanCial Deep Dive2

Millennials in 2015: Financial Deep DiveDiversity, self-expression and optimism define the Millennial generation.

As a group, this young generation is more racially and ethnically diverse

than any that came before it. Millennials are fueling an urban revolution,

on the hunt for the vibrant, creative energy that cities have to offer, all

of which resides right outside their doorstep. They value self-expression

and artistic pursuits. They also place a premium on authenticity–from

the products they buy to brands they choose to engage with.

After enduring the Great Recession, Millennials are cautious bankers,

wary of traditional financial and investment strategies. They want

an open, transparent and authentic relationship with their financial

institution. As a generation of consumers who define themselves by

their use of technology, many Millennials have taken a DIY approach

to their finances, relying heavily on mobile and online banking options

to manage their finances. Contrary to popular belief, Millennials are

savers rather than spenders. And when we look at the different types of

Millennial consumers, Upscale Millennials are more likely to engage in

financial planning and saving than their generation as a whole. These

young, affluent consumers earn more than $75,000 each year and

represent a strong pocket of opportunity for financial institutions.

3Copyright © 2015 The Nielsen Company 3

Millennials–striving, OptiMistic & authenticToday, there are more Millennials (those born between 1977 and 1995) than Baby Boomers. They are 77 million strong and make up 24% of the U.S. population. Just two years ago, Millennials and Boomers were on equal footing, each representing 24%. Now Millennials begin to stake a slight lead in population.

U.S. Generation DiStribUtion

27%

24%16%

23%

10%

GEN Z GEN XMILLENNIALS BOOMERS SILENT

nielSen Generation DefinitionS:• GREATEST/SILENT GENERATION (pRE-1945) AGE 70+• BABy BOOMERS (1946-1964) AGE 51-69• GENERATION X (1965-1976) AGE 39-50• MILLENNIALS (1977-1995) AGE 21-38• GENERATION Z (1996-pRESENT) UNdER AGE 21

Source: Nielsen Pop-Facts 2015

4 Millennials in 2015: FinanCial Deep Dive

Millennials have been hard hit by the recent turbulence in the economy.

They have experienced high unemployment, and many have high student

loan debt. They watched their parents and grandparents struggle with

investment losses during the Great Recession, which has left them with

low confidence in the stock market and traditional financial services.

However, Millennials’ high education levels and optimism foreshadow

their future success.

According to the second-quarter 2015 Nielsen Consumer Confidence

Report, roughly 70% of Millennials believe their personal finances will

be either good or excellent in the next year, yet 55% still feel like the U.S.

is in an economic recession. This makes Millennials cautious spenders

and savers. After covering their living expenses, Millennials are most

likely to put money into savings. Millennials are more than twice as

likely as the average consumer to have student loan debt, and roughly

26% of Millennials use their extra money to pay off these debts. Despite

improvement in economic conditions across the nation in recent

months, about one-quarter (23%) of Millennials do not have any extra

money after payday.

Source: Nielsen Consumer Confidence Report, Q2 2015

MillennialS DiScretionary SpenD

once yoU have covereD yoUr eSSential livinG expenSeS, which of the followinG StateMentS beSt DeScribeS what yoU Do with yoUr Spare caSh

pUTTING INTO SAVINGS

NEw CLOThES

pAyING Off dEBT/CREdIT CARdS/LOANS

hOLIdAyS/VACATIONS

I hAVE NO SpARE CASh

NEw TEChNOLOGy pROdUCTS

OUT-Of-hOME ENTERTAINMENT

hOME IMpROVEMENT/dECORATING

RETIREMENT fUNd

INVESTINGS IN ShARES Of STOCk/MUTUAL fUNdS

42%

35%

26%

24%

23%

23%

21%

16%

11%

11%


Control, transparency and personalization are vital for Millennials. They

prefer to do their own financial research rather than relying on others for

information. They also want the ability to customize their financial plan

to their specific lifestyle, and they’re more likely than older generations

to incorporate technology into their financial planning experience. By

allowing for small-scale, DIY investments, mobile apps like Betterment

and Acorns give Millennials a place to start their financial journeys.

Source: Nielsen Pop-Facts 2015

upscale Millennials- prOsperOus anD On the riseEconomic struggles are a reality for many Millennials, but the upscale Millennial subset is thriving. Roughly 27% of Millennials fall into this category, with household incomes of more than $75,000, 15% of this group earn more than $100,000. In addition to their high income, upscale Millennials have amassed significantly more wealth than their generation as a whole. The median liquid wealth value (income producing assets; IPA) for upscale Millennials is $157,500, more than 11 times the median IPA of their generation as a whole. Appealing to the distinct wants and needs of upscale Millennials is vital in capturing this lucrative segment for the long term as these consumers continue to advance in their careers.

Millennials by incOMe tOtal u.s. by incOMe

27.8%15.4%

26.6%18.7%

11.4%

UNdER $25,000 $25,000-$50,000 $50,000-$75,000

$75,000-$100,000 $100,000+

23.5%22.8%

23.9%17.8%

12.0%


Millennials by the nuMbers

TOTAL MILLENNIALS: UpSCALE MILLENNIALS (hh INCOME $75k+):

Median Household Income $48,797 $109,818

Presence of Kids 57% with kids 57% with Kids

Race/Ethnicity74% Caucasian, 21% Hispanic,

14% African-American, 4% Asian-Americans78% Caucasian, 15% Hispanic, 9% African-American,

6% Asian-Americans

Homeownership 47% Homeowners 68% Homeowners

Home Type57% Single Family Home,

23% Apartment, 9% Townhome, 3% Condo

72% Single Family Home, 12% Apartment, 8% Townhome, 4% Condo

Education30% College Graduates,

11% Post-Grad Work51% College Graduates, 21% Post-Grad work

Source: Nielsen Scarborough 2015

MeDian incoMe proDUcinG aSSetS (ipa)

UpSCALE MILLENNIALS

TOTAL MILLENNIALS

GENERAL pOpULATION

$157,500

$13,875

$25,600

Source: Nielsen Financial Track 2015

Upscale Millennials lead more established lifestyles than their

generation as whole, as they’re more likely to be married, well-educated

homeowners. On the other hand, life for the Millennial generation as a

whole tends to be in flux, as 29% say they plan to look for a new job and

18% plan to move in the next year.


Upscale Millennials are actively engaged in saving for the future.

According to Nielsen Financial Track, these consumers are more than

twice as likely as the average consumer to have variable-rate interest

money market accounts and CD accounts. Upscale Millennials are also

actively saving for retirement, as they are 60% more likely than the

average consumer to have an IRA and 87% more likely than the average

consumer to have a 401(k) plan. These traditional financial products

are not the only options for upscale Millennials, however. They also use

alternative financial services like prepaid debit cards and P2P payment

services.

While Millennials like to have personal control over their finances, they

also rely on professionals for investment advice. Upscale Millennials

are almost four times more likely than the average consumer to use

a financial advisor. However, according to research from the Luxury

Institute, Millennials are adopting different investment strategies than

older generations. While Gen X and Boomers tend to prefer full-service

brokerage firms, Millennials opt for independent financial advisors. After

their experience in the Great Recession, Millennials tend to trust full-

service brokerage firms less than older generations. The personalized,

individual approach of an independent financial advisor is appealing to

Millennials.

When it comes to Millennial financial preferences, the bank branch is

not dead. Roughly 85% of Millennials and 89% of upscale Millennials

say they’ve visited a traditional branch within the last 90 days. But the

bank branch doesn’t meet all the needs of upscale Millennials, as they’re

much more likely than the average consumer to use alternative branches

(within grocery stores for example) and call into customer service.

Millennials, especially upscale Millennials, want variety and options in

how they interact with their financial institutions. They want to use the

channel that best serves their needs in the moment.

Upscale Millennials are 60% more likely than the

average consumer to have an IRA and 87% more likely

than the average consumer to have a 401(k) plan.


It’s no secret that Millennials are active and engaged technology users. About 92% of Millennials own smartphones and roughly 61% own tablets. Millennials are more likely than the average consumer to bank on their PCs, smartphones and tablets, especially when making trades, opening new accounts, conducting research and making remote deposits. Upscale Millennials are even more likely than their generation as a whole to use technology to conduct their primary banking activities, like making deposits and transfers, and checking their balances or setting up alerts.

Source: Nielsen Financial Track 2015

the branch Still MatterS for MillennialS

85

6171

4153

60 6254 54

30 30 29

714

26

1217

25

50

85 89

ATM SERVICES

TRAdITIONAL BRANCh

ALTERNATIVE BRANCh

TELLER SERVICES

dRIVE-ThRU SERVICES

fINANCIAL AdVISOR

CUSTOMER SERVICE

GENERAL pOpULATION UpSCALE MILLENNIALS TOTAL MILLENNIALS

percent inDicatinG they USeD Service within laSt 90 DayS

pER

CEN

T


Source: Nielsen Financial Track 2015, Index where 100 = average U.S. consumer

MillennialS & online bankinG

MillennialS & Mobile bankinG

MillennialS & tablet bankinG

92

177

144184 193

315

178259 279

562

318

636

226

330230

381

173223

267216

267 277

451

303

506

270 248

436

185

92 93

103 104 105161

257227

333

150198 190

299

REVIEw STATEMENTS,

BALANCE, BILLS

REVIEw STATEMENTS,

BALANCE, BILLS

REVIEw STATEMENTS,

BALANCE, BILLS

pAy BILLS

pAy BILLS

pAy BILLS

TRANSfER BALANCES

TRANSfER BALANCES

TRANSfER BALANCES

MAkE TRAdES

MAkE TRAdES

MAkE TRAdES

OpEN A NEw

ACCOUNT

OpEN A NEw

ACCOUNT

OpEN A NEw

ACCOUNT

RESEARChEd fINANCIALpROdUCTS



MAkE A REMOTE dEpOSIT



400

400

400

500

600

600

800

300

300

200

200

200

100

0

0

100

0

TOTAL MILLENNIALS UpSCALE MILLENNIALS

INd

EXIN

dEX

INd

EX


What DOes it all Mean?Millennials have reached critical mass and are too large to ignore. The experience of the Great Recession has made Millennials cautious bankers, wary of traditional financial and investment strategies. Millennials want open, transparent and authentic relationships with their financial institutions. Focusing on these key elements will help financial institutions engage with Millennials and develop meaningful, lasting relationships within the financial landscape: • Court Upscale Millennials: Upscale Millennials represent a key area

of opportunity for financial institutions. These consumers are more likely to be more established and settled than their generation as a whole. Upscale Millennials have already amassed significant wealth and their early life stage indicates they’re only at the beginning of building their portfolios. Focusing on upscale Millennials will deepen engagement and build loyalty with this lucrative segment for the long term.

• Be Transparent and Make it Personal: Millennials are cautiously optimistic and value authenticity in their interactions with financial institutions. Developing a dialog through an open, transparent relationship with Millennials will build trust and engagement. They are risk-adverse and like to feel a part of the process. Give Millennials the opportunity to do their own financial research and customize their financial planning to meet their specific, individual needs in a variety of channels.

• Provide a Range of Options for Saving and Investing: Millennials are focused on saving for both the short term and long term. When Millennials have extra cash, they are it into savings accounts. However, these young consumers are still establishing themselves and need flexible options for saving and investing with low points of entry that will allow them to grow their assets. Likely to marry and purchase homes later in life, building relationships through trust and partnerships today will enable bigger opportunities in the future.


ABOUT NIELSEN Nielsen N.V. (NYSE: NLSN) is a global performance management

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consumers Watch and Buy. Nielsen’s Watch segment provides media and

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percent of the world’s population.

For more information, visit www.nielsen.com.

Copyright © 2015 The Nielsen Company. All rights reserved. Nielsen and

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millennials in 2015: financial deep dive - nielsen · 2019-05-29 · 30% college graduates, 11%...

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