It’s one thing to feel like others have more friends than you do, but it’s another to feel pressured into spending simply because of what you see on social media. Research from Allianz Life Insurance Company of North America found that 57% of millennials have spent money they weren’t originally planning to on products they saw in their social media feeds.
Larson Research + Strategy surveyed 3,006 people ages 20-70 who made at least $30,000 annually and were living in the U.S, on behalf of Allianz. Here are some of the points that stood out.
Social media has wide-ranging effects on millennials
The research found that while 61% of these young people reported feeling like they don’t have enough, or their lives aren’t good enough because of social media, 55% say they’ve felt FOMO, or “fear of missing out.”
Half of the respondents said they spend a greater amount of cash “on going out” than they did on housing, and 88% think social media makes analyzing how your “wealth/lifestyle” stacks up to others’ more common.
Paul Kelash, vice president of Consumer Insights for Allianz Life, commented on the findings:
“Millennials are finding innovative ways to build their financial strength and are becoming more confident because of these actions,” he said. “But, more than any other generation, social media and the allure to spend beyond their means could have long-term negative effects on their finances if they’re not careful.”
Young people choose to spend their money in different ways — research has also found that many millennials dole out more cash on coffee than they put away for retirement.
Here’s how millennials feel about money
Speaking of saving up for the Golden Years, 58% of millennials reported thinking that putting away money for that time in their lives “is a basic necessity, like food or housing.” This generation had “median retirement savings” of $35,000, which the press release describes as “equal to Gen Xers, who have less time to build their nest egg.”
Forty-one percent of millennials said they “set aside” cash monthly “for saving,” versus 36% of those in Generation X.
Just under half (48%) of millennials who have a 401(k) put away a minimum of 10% each month, while 44% of Baby Boomers and 36% of people in Generation X do so.
While saving for their futures at a higher rate than other generations, 70% of millennials feel “overwhelmed” when it comes to the idea of supporting themselves and family members “in the long term,” and many believe that working with “a financial professional” would be a big help in that department.