What Financial Tools do Millennials Prefer?

The millennial were born in the digital world, with technology being an active part of their daily lifestyle. On average, a study shows that millennials check their phones about 150 times a day. The exposure to new facets every day has made this generation vastly knowledgeable and insightful about technology. 

A study conducted  in 2021 suggested that this generation emphasizes immediate and tangible financial well-being by planning several aspects in advance. From setting up long-term financial goals to ensuring emergency funds – they lead in terms of financial goals.

Why are Financial Tools Essential?

There are a lot of financial tools and techniques available today. Convenience is a major factor that plays a role in keeping millennial investing and financial aspects on track.

A 2023 Forbes report suggests that 78% of millennials use mobile banking tools. These tools make it easier to manage finances by being accessible and user-friendly.

Additionally, another important feature that captivates the attention of the millennial audience is the increase in financial literacy. With these tools offering educational resources, the demystification of financial concepts is easier. 

Some of the types of financial tools that are on the millennials’ radar are:

• Mobile Banking Apps – Traditional banks have come up with personalized systems to allow millennials to engage in convenient and quick digital transactions. These banking apps created by institutions all over the globe have also made banking activities sustainable and approachable. No more standing in long lines to get a bank statement, pay bills, etc. 

• Budgeting Apps – Budgeting and allocating expenses for bigger and smaller aspects is one of the biggest tasks on the millennials’ minds. Finding the right kind of tools that will help them in this quest to track expenses, create financial goals, have a budget planner, etc, will go a long way. Graphic representations, visualizations, and detailed insight into overall spending habits will help better financial management. 

Applications like MINT help manage money, check expenses, and secure finances. This personal budgeting app was created in 2006 and is one of the most popular tools used globally by millennials. 

• Peer-to-Peer tools – These payment tools allow this advanced generation to become more advanced by making transactions easier and faster. Sending money to friends, family, shops, supermarkets, theatres, etc., is now hassle-free with this user-friendly financial tool. Another feature that most of these apps have is the ability to split the bill among people.

Applications like Venmo have gained popularity among this generation. Receiving cashback, considering cryptocurrencies, shopping, etc. – Venmo provides it all under one roof.  This application is secure and provides great opportunities for investment and an increase in financial literacy. 

• Digital Wallets – Digital wallets have changed the game of financial transactions by enabling millennials to make contactless, easy payments. Some of these apps offer rewards and cashback that appeal to the millennial audience.

One of the major examples of a globally used digital wallet is Google Pay. The flexibility of using these tools is also an attractive factor for this generation along with the overall convenience. Digital wallets can help receive and send money not only into other people’s wallets but also through direct bank transfers.

• Investment tools – Modern investment platforms offer affordable and simple ways to invest money. Algorithms help automate reduce costs and offer advice that was earlier only available if investors had access to human financial advisors.

Tools like Robinhood and Acorns are leading global investment tools that offer a wide range of planning and investment functionality at a low cost. 

• Personal finance tools – Millennials often report feeling empowered and in control when they feel like they have their personal finances in place. Consolidation of their financial accounts, transaction histories (even from multiple banks), etc., can provide an overview of the financial situation under one platform.

Personal Capital, now part of Empower can help track cash flow, monitor funds, review overall spending habits, etc. 

The Bottomline

The financial landscape and technology used by millennials is constantly evolving. Millennial trends, unique preferences, and the quest for convenient options take precedence. Financial tools that include a balanced blend of customization and automation help achieve their goals. The value of convenience, ease of access, personalized experiences, and occasional rewards are the motivating factors that play a role in convincing most of this generation to join hands with such financial tools. As millennials mature and have more complex financial goals, the pivotal role played by these tools will help shape their overall economic-well being.