Baby Boomers and Millennials are alike in many ways. Both generations are at a stage of life where they are “supposed to be” doing something. Millennials are “supposed to be” buying houses, getting married, and starting families. Baby Boomers are “supposed to be” leaving the workforce and settling into retirement.
Although many think the generational gap is too wide to close, Baby Boomers can learn a lot about personal finances from Millennial parents. Being told their whole lives that the measure of success as an adult is to land a good job, buy a house, get married, and have children (in that order), Millennials came of age when obtaining these things meant a completely different sort of sacrifice than the sacrifices of their parents. When Millennials decide to start a family, they find their own, sometimes completely innovative, ways to organize their finances and make ends meet.
Baby Boomers, too, expected to be able to retire with a reasonable level of ease. But what that means for them today is a completely different thing that what it meant for their parents. Baby Boomers need to be able to innovate their retirement the way that Millennial parents have innovated family life with young children.
Millennials are open-minded but hold strong opinions. They are willing to change their opinions based on the best evidence presented to them. Millennial parents are willing to challenge the model of parenting and raising a family given to them by their parents and grandparents. Necessity and desire are driving both parents out of the home to work, which makes home life more challenging than when one parent is at home full time. For this reason, Millennials are strong decision makers who are able to come to independent conclusion.
Baby Boomers can approach retirement the same way. Retirement, as they pictured it so many years ago, isn’t a fixed image. Retirement can be whatever fits into their life. If necessity or desire is keeping a Baby Boomer in the workforce, they can meet the challenges that arise from that with strong, independent reasoning that might not fit into traditional thinking.
Share economy is here to stay, and technology allows it to thrive every day. Websites and services like Uber or AirBnB have quickly become a normal part of life for Millennials, and forecasts suggest that this business model is on the rise. We are connected more than ever before, and we continue to strengthen those connections.
Baby Boomers are disadvantaged in terms of their familiarity with technology. The tech boom that Millennial parents grew up experiencing left them agile to life-changing devices, platforms, and software. What’s more, Baby Boomers are less trusting of the dangers of the share economy, partly because of their lack of experience in the environment. But if Boomers can adapt to the share economy, they can find ways to save money through our society connections and possibly access this business model in their companies.
For those Baby Boomers who have left the workforce, the share economy opens doors to run a small business using technology and the skills you’ve acquired over your lifetime for hobby or for spare income. In fact, many websites make it easy to do small jobs on your terms, as often or as little as you’d like. This might not provide a full time income for Baby Boomers, but it does mitigate the stress of leaving the steady stream of income associated with traditional jobs they might want to retire from or put more money into a budget for investing.
Millennial parents love independence and want to be able to figure things out on their own. When it comes to investing, Millennial parents would rather be more hands on with their financial transactions and decisions. Crowdsourcing, the practice of raising money for a particular project by asking lots and lots of people for a small investment or donation, and other tech investing options such as online trading platforms, are changing the way we think about portfolios. Millennials are at the forefront of this change, and in many cases they are founding the companies and creating the software that makes these changes happen.
Baby Boomers can get more involved in their own portfolios with the platforms available online. Investing in a startup doesn’t have to mean sinking $10,000 or more into a project any more. Investments like this may have a high level of risk, but smaller initial investments and the possibility of a high return can make investing a profitable hobby.
Feeling uncomfortable with the idea of using tech to invest? Here’s another lesson that Baby Boomers can learn from Millennial parents: jump right in and learn by doing. Millennials value hands on experience and like to make connections on their own. Millennials often take the initiative to seek more training and education, and incorporate that new information into their lives, careers, how they run their household, and how they parent their children. As new tech comes available, Millennials don’t wait for someone else to explain it to them. They figure out how to use it to make their life work more efficiently.
We’re not suggesting you place very large investments using platforms online until you are certain that you know what you are doing, or that you jump into any expensive endeavor without seeking advice or training. But the smartest way that Baby Boomers can learn to use tech to make their lives easier and their bank accounts fatter is to jump right into it.
Millennial parents second guess the value of material things, opting instead for life experiences and meaningful interactions with family, friends, and their children. While Millennials place a higher value on some material objects, like smartphones and other devices, internet access and wireless service, they place a much lower value on the assets coveted by Baby Boomers like sprawling homes, expensive cars, boats, and art.
Baby Boomers who can learn to downsize will enjoy the financial benefits of no longer having to pay taxes and maintenance costs on these assets. Beyond that, they could learn a little bit about the philosophy that has enchanted some Millennials and teaches them to worry less about material goods and more about the experiences in their lives.