If you think Millennials have it tough these days, you’re not alone. Record-level student debt, rising home prices, stagnant wages, and the disappearance of workplace pension plans, are just a few of the challenges faced by today’s young people.
Majority Expect to Bounce Back from “Failure to Launch”
Life is a road full of twists and turns. Many millennials face delays and obstacles on their way to achieving financial milestones like landing their first full-time job and buying a home. It’s important to keep things in perspective: it’s perfectly normal to take a wrong turn – or two.
“Failure to Launch” (named after the 2006 American romantic comedy starring Matthew McConaughey and Sarah Jessica Parker) can take an emotional toll when you fail to reach your financial goals in the timeframe you had hoped.
The silver lining is most millennials aren’t afraid to own up to their mistakes. Seventy-five per cent of young Canadians take ownership for their mistakes and believe they will come back from setbacks, says a new research study by Capital One Canada and Credit Canada Debt Solutions. The study, conducted in honour of the eighth annual Credit Education Week, highlights the many challenges faced by young Canadians.
Financial Independence and Social Media Play Big Role
Most Millennials strive for financial independence, but it doesn’t always come easy. Young people face a number of obstacles on the way to reaching financial goals: lack of earning power (35per cent), unemployment (31per cent) and lack of budgeting, planning and saving (28per cent).
The rise in popularity of social media is impacting how young people feel about themselves. Twenty-eight per cent of those under 30 said seeing their friends’ lives on Facebook directly impacted their ability to reach their financial goals. With 51 per cent afraid someone will find out about the challenges they face, there’s peer pressure to appear successful on social media. This is taking an emotional toll on many millennials: 31 per cent admit to feeling like a loser, 30 per cent feel depressed and 23 per cent are embarrassed.
“We understand that this trend is not only prevalent, but it can be emotionally taxing for many young Canadians trying to achieve financial success,” said Laurie Campbell, CEO of Credit Canada Debt Solutions. “It’s our mission to work with Canadians to provide the tools necessary to take control of their finances.”
There’s Still Hope for Young People
Of those who’ve faced a challenge reaching their financial goals, 60 per cent said help from a partner, online budgeting tools and financial or investment supports in place, will play a big part in successfully launching.
“These recent data reflect a large gap in credit and financial awareness among a key demographic here in Canada,” says Shane Holdaway, President of Capital One Canada. “At the same time, it is heartening to see that the right tools and support can have a positive impact on Canadians looking to succeed with credit.”
The financial hurdles you face seems to depend a lot on where you live. Canadians from the West said the largest money shortfall ($79k) causing their failure to launch compared to $31K in Ontario, $31K in Quebec and $40k in the East.
Credit Canada Debt Solutions and Capital One Canada offer the following tips to help Canadians succeed financially:
- Develop a detailed plan that outlines your financial goals, ensure that you look at short, medium and long term objectives
- Find a mentor or life coach to work with you to help you achieve real change
- Share your goals with others for affirmation and support
- Be realistic about your expectations
- Create a journal to track your progress
- Reward yourself for taking small steps for big change
The Bottom Line
While social media can paint perfect pictures of the lives of friends, the reality is that financial struggles are common for young adults. It’s important for young adults to take a realistic look at their finances and plan accordingly. Don’t worry about about keeping up with the “Joneses” – use the available tools and resources to set realistic financial goals and stick with them long term. Mistakes will be made, but millennials have time on their side to get back on track with a financial plan.
