Financial Planning and Millennials

May 8, 2021

Between the late-1970s and the mid-1990s, the most significant Canadian workforce referred to as millennials (or Generation Y) was born. As the largest generation by population size in North America, by 2025, three out of every four workers globally will be millennials.1

This first genuinely digital generation, raised amid laptop computers, cell phones, tablets, and other rapidly advancing technologies, transforms the way they work with a financial strategist.

Bridging the Intergenerational Wealth Gap

Affluent baby boomers (parents of millennials) reaped the benefits of soaring markets, building huge investment portfolios while paying off mortgages. Comparatively, millennials and the following generation Z have been weighed down by student debt, earn lower wages often in short-term contract work, have fewer retirement pensions, and often face volatile markets when investing.2 Thus, their family wealth is 34% below what earlier generations held at the same age.3 Our goal is to increase millennial wealth while still having time on their side ahead of retirement.

  • “Almost a third of Canadians between the ages of 23 and 38 concede they are ‘not at all knowledgeable about retirement savings plans” plus “More than 40% of respondents admitted to putting off learning about investing because they feel they’re stretched too thin to contribute. Another 28% said they were saving for other purposes.” 5

Strategic Millennial Financial Solutions

Being the most prominent consumer group that influences trends, the right financial strategy must also correspond to the millennial mindset, values and lifestyle, with transparent, open communication.

Navigating Opportunity and Risk

  • Recently during the pandemic, the North American stock markets have reached their highest value. Banks report excess profits. The tech sector has soared, with some companies’ stock capitalization exceeding a trillion dollars. Real estate has skyrocketed. Statistics Canada reports that inflation from April 2021 to April 2022 is 3.6%. As far as investments go, opportunities for wealth have soared since the pandemic, though pre-pandemic it did seem that “Asset appreciation is unlikely to be as rapid anytime soon”.6
  • Despite timely global information via Facebook, Twitter, Linked In, etc., many remain behind in wealth creation. A recent study indicates that many millennial savers merely invest to keep up with inflation or leave their money sitting in cash.7 Strikingly, those under 35—the furthest away from retirement—are holding twice as much cash not invested as those over the age of 65, about 33% versus 15%.8
  • Millennials open to new ideas believe financial decisions must allow customized financial processes. In this way, their values, needs and desires are built into their wealth-building process.
  • Investor trading determined by artificial intelligence (AI) using algorithms is only a small part of the equation. An information manager noted:
    • “Millennials are pushing us hard in our industry, saying, ‘Stop over-virtualizing everything. Several key life events are critical for us to interact with a human being.’” 9 The already highly automated financial services industry conjoins human interaction via professionally trained advisors with the oversight that stewardship demands.
  • Debt management is needed. A recent study reveals that most millennials have learned through trial by fire. Many have a checking or savings account, though a troubling minority, even those with access to credit cards, use payday lenders. Student loans are their number one source of long-term debt.10 Proactive debt management resonates with millennials who are wary of debt.

Statistics show that 68% of millennials have at least one credit card; one in five has four or more cards. More than half of credit card users report carrying over a balance—for which they were charged interest—in the last 12 months, and nearly 45% of cardholders’ report making only the minimum payment.11

  • Aiming for financial literacy, Millennials raise the bar to increase their financial literacy by establishing financial advisor mentoring. We have educational resources and tools to assist decision making as we collaborate on financial planning tactics.


2 Bloomberg

3 Federal Reserve Bank, MO

4 citation removed

5 Canadian Business: A recent survey by TD Bank 2021

6 Bloomberg

7 CIBC as noted in Canadian Business

8 Ibid

9 Panelist at AI/Fintech Advocis®, Chadi Habib, Desjardins Group

10 Generation Y Financial Study Washington U

11 National Financial Capability Study: Filene Research Institute




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