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Millennials Hit Saving Goals With More Than Spare Change

AnthropologieDepartment Manager

The history of formal banking in America dates back to the 1800s. By 1820, over 300 commercial banks and several mutual savings banks were established to promote thrift among the poor. But when it comes to saving money, you may learn more at the zoo than the bank. Whether be it squirreling (hiding money or something of value in a safe place) or building a nest egg (a sum of money saved for the future), these animals are far from extinction, and Americans can learn a thing or two from them.

Ask any American, “What do you do with your loose change?” and you can assume three things:

1. You can guess what generation they are from.

2. You’ll know if they have recently used cash as tender.

3. You’ll have an idea if they are a penny pincher or a big spender.

Without going into an in-depth, theoretical analysis of the habitual savings patterns of Americans, judging by the influx of next generation personal finance management tools (PFM) currently available, it is safe to say that in the wake of the 21st century, there seems to be a kaleidoscopic ideology that supersedes most basic money saving methods.

2One of the latest savings applications plays on the emerging and somewhat addictive decision-making behavior of swiping. Hip Money was introduced by the Lincoln, Nebraska-based startup Hip Pocket. The new mobile phone application was unveiled in September 2015 at FinCon in Charlotte, N.C. Hip Money enables a simple “Swipe to Save” feature that builds on the habit of passive saving.

How you save is just as important as where you save it. From an early age, many American children receive some form of money, oftentimes as a reward for a coming-of-age milestone. From finding money left by the tooth fairy under a pillow, to receiving money as a birthday, holiday or graduation gift, there comes a time when a young person will experience their first dose of wealth management. Whether the child decides to put the money in a piggy bank, joint bank account with their parents or just the spends the money YOLO (you only live once) style; the first time a person associates a value with money could possibly define their relationship with saving in the future.

Modern day personal finance management apps weren't at the disposal of the economic scientist who developed the three major theories of consumption and savings behaviors. While the life-cycle hypothesis, the permanent income hypothesis and the relative income hypothesis all have their conceptual roots in the microeconomic theory of consumer choice, there have been major disruptive innovations that now streamline many of the antiquated processes of money management.1

The major theories of consumer choice are still used as an economic benchmark in consumer trends, but emerging robo-advising tools leave both millennials—the largest generation in the US workforce—and banking institutions aware of the need to save but are unsure of the approach. Hip Money could pose a plausible solution to this challenge. According to the Hip Pocket/Hip Money iStart profile, “Our app is targeted toward millennials because of their use of technology, coming student loan debt crisis, and their -2% savings rate. Anyone can use any of our past products, but we feel the Hip Money app is a daily app that can best solidify our longer-term vision of being your source for trusted financial info in bite-sized chunks.”

With millennials on the mind of robo-advisors, what’s on the mind of millennials? In a study released on September 2015 by the Insured Retirement Institute and The Center for Generational Kinetics titled “Will Millennials Ever Be Able to Retire?,” new research reveals the surprising truth about retirement by generation in the United States.

Although retirement may be on millennials’ minds, when the study specifically asked if they were “actively preparing” for retirement, the answers were very different from what we found when we asked if they “save” for retirement. Only 29% of millennials in the study described themselves as “actively preparing” for retirement.

In addition, only 19% of millennials said that they were likely to use a robo-advisor. At this point, it appears that working with a human is the stronger preference of millennials, particularly in light of their desire to be walked through the planning process.


Personal saving goals can fluctuate depending on the expenses associated with the wants and needs of life. According to the latest American Express Spending & Saving Tracker, 2015’s savings goal overall is within reach. Americans reported an average savings goal of $11,292 for the year. During a financial check-in in August, consumers reported a total average savings of $7,518, up 5.1% from a check-in at the same time in 2014, and are two-thirds (67%) of the way to reaching the savings goal reported earlier in the year.

Ruth Pender

AnthropologieDepartment Manager

Ruth Pender is a former Community Manager at MEDICI (f.k.a Let’s Talk Payments).

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