Nick Stewart of the Stewart Group, Hastings.
I'm not just picking on millennials. Well, maybe I am.
What's a millennial anyway? Unless otherwise noted, I mean anyone born between 1980 and 2000.
We have all read about the financial plight of millennials, who are not only drowning in student loan debt but other loans and expenses as well. They include car payments, rents or mortgages, and credit card bills.
As a Gen X member, who has "been there, done that", I feel their pain. However, it is time for millennials to focus on the road ahead and find ways to secure their financial futures.
Undoubtedly, the ability of millennials to save and invest will be met by challenges. According to a study by the National Endowment for Financial Education, two-thirds of millennials have at least one long-term debt (student loan, home mortgage, car loan).
The study also found that nearly 30 per cent of those (millennials) with checking accounts had overdrawn their account in the prior 12 months and nearly 20 per cent of those with a self-directed retirement account either took a loan or made a hardship withdrawal.
Millennials are about half as likely to own a home as a young adult was in the 1970s and, based on current trends, many millennials won't be able to retire until they are 75.
Also, millennials are delaying partner-marrying, house-buying and kid-having for longer than any previous generation.
The financial strain millennials feel today will become a real pain as they move into their golden years, which are expected to last longer than their parents.
Millennials must focus on both the immediate and the future. We have all heard the statistics. In defiance of the conventional wisdom, some reports say millennials are saving.
According to a Merrill Edge report, young people are "outperforming everyone in saving", only with different goals in mind. They are just more likely to save for short-term goals than ones that are decades away.
The question is, can millennials do what they want to do, not only now, but over the course of their life?
According to the survey, From Trust to Loyalty, "Millennials lack trust in financial institutions because they have let them down with the financial crisis. The recession and the housing crisis they witnessed had effects on many of their friends and family."
I believe many millennials are ready to move forward but are just not sure how to go about investing, saving and retirement. They are the social generation and get their everyday advice from friends and Google. That is fine for a recommendation for a restaurant to go to, but not advised with investing advice from peers who have little knowledge of financial markets.
Next week I'll talk about opportunities for millennials who want to take further steps to create a brighter financial future.
• Nick Stewart is an authorised financial adviser and executive director of Stewart Financial Group. Stewart Group is a Hawke's Bay-owned and operated independent financial planning firm based in Hastings. This represents general information only. Before making any financial or investment decisions, we recommend you consult a financial planner to consider your investment objectives, financial situation, and individual needs. A disclosure statement can be obtained free of charge by calling 0800 878 961.