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Millennials and Finance - US - April 2015

Published By :

Mintel

Published Date : Apr 2015

Category :

Banking

No. of Pages : 144 Pages

Millennials are young and in the beginning stages of establishing themselves, their households, and their families. Their needs at this time are quite specific and revolve largely on learning how to manage their day-to-day finances. Institutions that can best help them with these most fundamental are likely to be those Millennials will look to stay with as time goes on.
Table of Content

Scope and Themes

What you need to know
Data sources
Consumer survey data
Direct marketing creative
Abbreviations and terms
Abbreviations
Terms

Executive Summary

Who are the Millennials?
How they feel about financial institutions
The Millennial consumer
Account ownership
Financial challenges and priorities
Do they want help?
How Millennials feel about money
Unsure about credit – and their futures
What we think

Issues and Insights

Financial literacy: A huge problem
Issues
Implications
So how do they really feel about money?
Issues
Implications
Are advisory services for Millennials an opportunity for banks?
Issues
Implications

Trend Application

Inspire Trend: Help Me Help Myself
Inspire Trend: FSTR HYPR
Inspire Trend: The Unfairer Sex

The Size of the Millennial Market

Key points
Millennials are one-quarter of the population
Figure 1: US population, by generation share, 2015
Millennial population continues to grow
Figure 2: US population, by generation, 2010-20

Socioeconomic Profile of Millennials

Key points
A racially and ethnically diverse group
Figure 3: US population, by race/Hispanic origin, 2015
Millennials are delaying marriage
Figure 4: Percentage of those married at age 18-32, by generation
Millennials are living at home
Figure 5: Percentage of Millennials living at home (2012)
Millennials’ median household income
Figure 6: US median household income, by generation of householder, 2013

Innovations and Innovators

Key points
Automated investing services

Marketing Strategies

Overview
Reaching Millennials
Incentives work
Figure 7: People’s United Bank’s gift card direct mail ad, 2015
Figure 8: TD Bank incentive checking account direct mail ad, 2015
Figure 9: Ally Bank IRA online ad, 2015
Mobile banking
Figure 10: Wells fargo mobile text banking service email, 2015
Figure 11: Synovus Bank P2P email ad, 2015
Long-term planning
Figure 12: Fidelity IRA print ad, 2015

Account Ownership

Key points
Most accounts are in own name
Figure 13: Ownership of financial products/accounts, December 2014
One bank, or many?
Millennial women are behind
Figure 14: Ownership of financial products/accounts – In my own name, by gender, December 2014
Millennial parents are strapped for time
Figure 15: Ownership of financial products/accounts – In my own name, by parental status, age of children, December 2014
So…who has online accounts?
Key driver analysis – Methodology
Figure 16: Key drivers of online only banking, December 2014

Communication Preferences

Key points
Frequency
Less communication is better than more
Figure 17: Preference of communication frequency, December 2014
Frequent communication is not important to young women
Figure 18: Preference of communication frequency, by gender and age, December 2014
Mail and email serve different purposes
Figure 19: Preference of communication frequency, by communication channel, December 2014*
Channel
Most want to be reached via email
Figure 20: Communication channel preference, December 2014
Parents have different preferences
Figure 21: Communication channel preference, by parental status, December 2014

Major Financial Challenges and Priorities

Key points
Current financial challenges
Saving money and paying bills are the biggest challenges
Figure 22: Top savings and paying priorities, December 2014
Marriage changes priorities…
Figure 23: Top three major financial challenges, by marital status, December 2014
As does having children in the household
Figure 24: Top three major financial challenges, by presence of children in household, December 2014
Upcoming financial priorities
Current challenges remain future priorities
Figure 25: Most important financial priorities in next 12 months, December 2014
Saving is most important to highest earners
Figure 26: Most important financial priorities in next 12 months, by household income, December 2014
Parents prioritize paying day-to-day bills
Figure 27: Most important financial priorities in next 12 months, by parental status, December 2014

Use of Financial Advice

Key points
Advice is not popular among Millennials
Figure 28: Professional financial advice received, December 2014
More Millennials need advice about saving
Figure 29: Professional financial advice received, by major financial challenges, December 2014
Men are more likely to seek advice
Figure 30: Professional financial advice received, by gender, December 2014
Gender differences disappear with age
Figure 31: Professional financial advice received, by gender and age, December 2014
Bank advisers are most used by Millennials at all income levels
Figure 32: Professional financial advice received, by household income, December 2014
Millennials with families want advice
Figure 33: Professional financial advice received, by marital and parental status, December 2014
Bank advisers are preferred
Figure 34: Type of financial adviser preferred, December 2014

Attitudes toward Finance and Money

Key points
Millennials: Money does not buy happiness
Figure 35: Attitude toward finance and money – Any agreement, December 2014
How Millennials feel about money
How Millennials feel about credit
Older Millennials have a changed perspective
Figure 36: Attitude toward finance and money – Any agreement, by age, December 2014
Hispanic Millennials are focused on saving
Figure 37: Attitude toward finance and money – Any agreement, by Hispanic origin, December 2014
Mothers and fathers have different outlooks
Figure 38: Attitude toward finance and money – Any agreement, by parental status, December 2014

Source of Financial Information

Key points
Family is most important source of financial information
Figure 39: Source of financial information, December 2014
How Millennials get information
Social media use
Figure 40: Source of financial information, by gender and age, December 2014
Parents more likely to seek out information
Figure 41: Source of financial information, by parental status, December 2014

Cluster Methodology

Financial Free Spirits
Demographics
Characteristics
Opportunity
Interested Conservatives
Demographics
Characteristics
Opportunity
Financially Disinteresteds
Demographics
Characteristics
Opportunity
Cluster demographic tables
Figure 42: Target groups, by demographics, December 2014
Cluster characteristic tables
Figure 43: Target groups, by target clusters, December 2014
In own name
Figure 44: Ownership of financial products/accounts – In my own name, by target clusters, December 2014
Figure 45: Ownership of financial products/accounts – In my own name, by target clusters, December 2014
Joint account with parent(s) guardian
Figure 46: Ownership of financial products/accounts – Joint account with my parent(s)/guardian, by target clusters, December 2014
Figure 47: Ownership of financial products/accounts – Joint account with my parent(s)/guardian, by target clusters, December 2014
Joint account with spouse/partner
Figure 48: Ownership of financial products/accounts – Joint account with my spouse/partner, by target clusters, December 2014
Figure 49: Ownership of financial products/accounts – Joint account with my parent(s)/guardian, by target clusters, December 2014
Do not have
Figure 50: Ownership of financial products/accounts – Do not have, by target clusters, December 2014
Figure 51: Ownership of financial products/accounts – Do not have, by target clusters, December 2014
Figure 52: Preference of communication frequency, by target clusters, December 2014
Figure 53: Preference of communication frequency, by target clusters, December 2014
Figure 54: Preference of communication channel, by target clusters, December 2014
Figure 55: Major financial challenges, by target clusters, December 2014
Figure 56: Major financial challenges, by target clusters, December 2014
Figure 57: Major financial challenges, by target clusters, December 2014
Figure 58: Most important financial priorities, by target clusters, December 2014
Figure 59: Most important financial priorities, by target clusters, December 2014
Figure 60: Most important financial priorities, by target clusters, December 2014
Figure 61: Professional financial advice received, by target clusters, December 2014
Figure 62: Attitude toward finance and money – Any agreement, by target clusters, December 2014
Figure 63: Attitude toward finance and money – Any agreement, by target clusters, December 2014
Figure 64: Source of financial information, by target clusters, December 2014
Figure 65: Source of financial information, by target clusters, December 2014
Figure 66: Source of financial information, by target clusters, December 2014

Appendix – Other Useful Consumer Tables

Account ownership
In own name
Figure 67: Ownership of financial products/accounts – In my own name, by demographics, December 2014
Figure 68: Ownership of financial products/accounts – In my own name, by demographics, December 2014
Joint account with spouse/partner
Figure 69: Ownership of financial products/accounts – Joint account with my spouse/partner, by age, December 2014
Figure 70: Ownership of financial products/accounts – Joint account with my spouse/partner, by age, December 2014
Do not have
Figure 71: Ownership of financial products/accounts – I do not have this, by gender, December 2014
Figure 72: Ownership of financial products/accounts – I do not have this, by gender, December 2014
Communication preferences
Figure 73: Preference of communication frequency, by demographics, December 2014
Figure 74: Preference of communication frequency, by demographics, December 2014
Figure 75: Preference of communication frequency, by preference of communication channel, December 2014
Major financial challenges
Figure 76: Major financial challenges, December 2014
Figure 77: Major financial challenges, by demographics, December 2014
Figure 78: Major financial challenges, by demographics, December 2014
Figure 79: Major financial challenges, by demographics, December 2014
Most important financial priorities
Figure 80: Most important financial priorities, by demographics, December 2014
Figure 81: Most important financial priorities, by demographics, December 2014
Figure 82: Most important financial priorities, by demographics, December 2014
Professional financial advice received
Figure 83: Professional financial advice received, by demographics, December 2014
Figure 84: Professional financial advice received, by ownership of financial products/accounts – Investment account, December 2014
Figure 85: Professional financial advice received, by major financial challenges, December 2014
Figure 86: Professional financial advice received, by major financial challenges, December 2014
Attitude toward finance and money
Figure 87: Attitude toward finance and money, December 2014
Figure 88: Attitude toward finance and money – Any agreement, by demographics, December 2014
Figure 89: Attitude toward finance and money – Any agreement, by demographics, December 2014
Source of financial information
Figure 90: Source of financial information, by demographics, December 2014
Figure 91: Source of financial information, by demographics, December 2014
Figure 92: Source of financial information, by demographics, December 2014

Appendix – Key Driver Analysis

Interpretation of results
Figure 93: Key drivers of online only banking – Challenges, December 2014
Figure 94: Key drivers of online only banking – Priorities, December 2014

Appendix – Trade Associations

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