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This week’s econ quiz will take a closer look at consumer spending, for the nation’s largest consumer segment: Millennials.
Millennials are the cohort born between 1981 and 1996, ranging in age from 28 to 43 years old today. According to the market research firm Mintel, Millennial consumer spending can be characterized by a lack of economic security brought on by tumultuous economic change during their formative years.
Emotional stress and burnout, and a shift towards family structures that differ from traditional two-married-parent households has also had an effect on their spending patterns. About 58% of Millennials age 30 to 44 have children. While their tendencies to have children later in life, have fewer, or no children at all, may be related to economic insecurity during their early adult year. Millennials who do become parents are spending more per child than previous generations, and are more likely to provide their children with a financially secure environment as a result of waiting until later in life to have children.
While over 50% of American Millennials feel they’ll have to work as long as they are able, this percentage varies by race, with Black and Hispanic Millennials feeling significantly more uncertain of their economic future. The emotional stress related to financial insecurities, makes for a lucrative market for stress-reduction products, food, and drink. For example, 34% of Older Millennials report regularly consuming products that contain a promise relaxation or calming in their advertising.
That brings us to today’s question. While delaying child rearing and buying stress reduction products is nice, the best way to avoid financial stress is to plan. What percentage of Millennials stick to a strict budget?
Answer: A. One-fourth of Millennials follow a strict budget. While they attempt to spread their money as far as it can go, they are willing to splurge on good quality products.