Millennial Generation: More Conservative In Saving Habits

For a generation that is often criticized for their coddled upbringing and conspicuous consumption habits, new findings suggest that Millennials are actually more conservative than their parents when it comes to spending.

According to a study that was conducted in February by, fewer Millennials have more credit card debt than money saved for a rainy day as compared to the boomer generation.

Twenty-four percent of Millennials have more debt than savings, compared to 31 percent of boomers.
Perhaps bearing witness to the tech bust in 2000 and the financial catastrophe of 2008 and watching their parents' retirement funds dry up made Millennials -- 18- to 30-year-olds -- more inclined to save. It has certainly made them more wary of making high risk investments.

Still, both generations are facing a cash crunch. “Emergency savings remains a problem area for many Americans, which leaves them only one unplanned expense away from having high-cost debt,” Greg McBride,’s senior financial analyst, said in a statement.

One in four Americans have more debt than savings. Lingering high rates of unemployment and stagnant wages have caused many to drain life savings and buy on credit, leaving only 54 percent of Americans with more money in their savings accounts than they owe to credit card companies.

These statistics represent a small improvement over last year's figures, which showed that 52 percent of Americans had more in savings than in credit card debt.

"As difficult as it may be to boost savings, having an adequate emergency savings cushion is critical to maintaining financial stability, and Americans need to find ways to sock away more cash for a rainy day,” McBride said.

Credit card spending and racking up debt is also a major factor bringing down the financial well-being of all Americans. After the recession, credit card usage fell to an all-time low. But recentdata suggests we're returning to our pre-recession spending habits: In the second quarter of 2011, credit card spending grew exponentially with Americans accumulating $18.4 billion in debt, or 368 percent more debt that we accumulated in the second quarter of 2009.

Even more troubling: Americans underestimate their credit card debt by a third, according to a study by the Federal Reserve Bank of New York. While the average household thinks they owe $4,700 to credit card companies, lenders say this number is actually $7,134.