Spending Money: You’re Doing It Wrong

Listen up, Millennials. According to your mom, your figure, and now researchers, you’re spending money all wrong. Instead of using cash, members our generation are much more likely to use a debit card to pay for our overpriced coffee, the one-gallon of gas that we need to make it to work, and our tickets to the Dollar Movie Theater.

TIME reported last week that the totally legit-sounding website “CreditCards.com” has found that Millennials are ditching the Benjamins in favor of some plastic. While more than three-fourths of adults over the age of 50 use cash to pay for items that are $5 or less, only about half of adults between 18 and 29 are doing the same (no, they aren’t stealing the stuff instead. They are just paying with either a credit or debit card).

Using a card instead of forking over a small chunk of cash may be a bad thing.

Research has suggested that we’re inclined to spend more when we swipe. A 2008 study published in the Journal of Experimental Psychology found that physically handing over bills triggers an emotional pain that actually helps to deter spending, while swiping doesn’t create the same aversion. As a result, the study found, cash discourages spending whereas plastic encourages it.

So, apparently this all means that we’re more likely to spend more money than we have since we aren’t actually watching real money disappear from our hands.

Other downsides to paying with a credit and/or debit card: apparently you become more focused on the benefits of a purchase instead of the price, and you’re more likely to overspend if there’s a “minimum purchase amount” requirement in order to use a credit or debit card.

However, “CreditCards.com” (I keep putting this in quotation marks because the name is just so ridiculous) fails to give us enough credit. Let’s be real: at least a debit card is better than paying with a straight up credit card. Money is immediately withdrawn from your account when you pay with a debit card, and if you don’t have enough money in your checking account, you’ll either be unable to make the transaction at all or be forced to pay a hefty overcharge fee.

Not gonna lie, I am far more inclined to use a credit card than any other method of payment. But I actually find myself more willing to spend money when I actually have cash as opposed to when I only have a credit card. It’s almost like I see it as loose change or something (like, I don’t think it’s that big of a deal to waste a few one dollar bills on some junk from a vending machine).

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Weekly(ish) Retweet Roundup

Here are my summaries of some of the news stories I retweeted this week. Featuring: the French “ban” on checking work e-mails, the “Gone Girl” trailer, ‘New Girl”s Max Greenfield’s thoughts on ‘Scandal,’ and how millennials are screwing up their finances.

France Didn’t Ban People From Checking Work E-mail After 6 p.m. This is Why it Should Have | via The Washington Post

There were false reports last week that France had passed a law banning the checking of work e-mails after 6 p.m. Turns out that the “policy” was actually only part of an agreement between some labor unions and companies. However, the author of this article points out that France already has a shorter work week than many other countries – only 35 hours per week. This actually makes French workers more productive, less stressed, and less tired. Um, maybe us Americans should start doing this too?

Ben Affleck May or May Not Have Killed His Wife in David Fincher’s ‘Gone Girl’ | via Slate

We finally got to see the trailer for the movie adaptation of Gillian Flynn’s mystery thriller “Gone Girl” this week, and every news outlet was abuzz. The trailer flies from one scene to the next – and doesn’t really offer too much background on the story. If I had never read the book, I probably wouldn’t even be bothered to watch the movie after seeing this trailer. Nevertheless, I’m still really excited about this film, and I think it’s so neat that Flynn actually re-wrote the last third of the screenplay so that even readers of the book won’t know what to expect.

Save Young People From Themselves | via The New York Times

New studies show that millennials are less inclined to save money for retirement – and they are less inclined to invest it in the stock market. That’s not really a surprise, considering how financially-scarred we are.

Less than half of people under the age of 25 who are eligible for 401(k)s take advantage of them. About 60 percent of people between 25 and 34 have 401(k)s. After watching the stock market plummet in 2008, most millennials have chosen to keep half of their retirement portfolios in cash (apparently this is a bad thing – for us and the rest of America).

Even the Stars of ‘New Girl’ Love ‘Scandal’ | via Max Greenfield’s Twitter

“This Whole Post Graduation Thing Is Not Turning Out How I Planned”

“Post Grad,” a 2009 comedy starring Alexis Bledel, Jane Lynch, Carol Burnett, and Michael Keaton, is the story of the difficulty, the ridiculousness, the stress, and the uncertainty that comes after graduation. After Bledel’s character graduates from college, she can’t find a job and is forced to move back in with her parents. Hijinks ensue. It’s a funny, but sadly realistic, portrayal of the life of the typical post-grad millennial.

“This is not the way it’s supposed to go. You’re not supposed to come back when you’ve already left the nest!”

Hat tip to Hello Quarterlife Crisis for inspiring this post.

Having a Quarter-Life Crisis? Calm Down, You.

…and read these stats on post-grad millennials’ views on jobs and education.

We’ve all been there. You’re at some social gathering, maybe a wedding, a family get-together, or a night out with friends. You’re having a great time… UNTIL somebody says this: “Oh, you studied [insert any college major/master’s degree here]? You must have learned so much. So, what do plan on doing with that?”

Your brain freezes. GREAT. Being the paranoid parrot that you are, you assume that this person asked this question because he or she:

  • a) is genuinely interested in your future (hah! yeah, right!).
  • b) is trying to size you up like Regina George (“So, you agree? You think you’re really smart?”).
  • c) is under the impression that your major is about as useful as mastering the art of Ross Gellar’s “unagi.”
  • d) doesn’t think you’ll ever find a job, and is insinuating he/she believes you will be living in a cardboard box.
  • e) is just trying to make conversation (hah! yeah, right again!).

You try to be nonchalant. You try not to give away the fact that you’re panicked beyond belief. You try to give a safe answer. “Oh, you know, I’m open to pretty much anything,” you say. Which is true. You are willing to take something, anything just to get your foot in the door.

Ugh. “Could this BE anymore awkward?” says the Chandler Bing voice inside your head.

college

Chip up, buttercup! You’re not the only person who has experienced this awkward conversation. And while the last thing you may want to hear about is how well other twenty-somethings are doing career-wise, or what they think about our current economic state, you could learn a thing or two from them. Their insights into the economy, what skills are necessary in the workplace, and regrets they have about their education may help you figure out how to make it in the real world. Remember: if those fools can do it, so can you! Continue reading

The Financially-Scarred Millennials

I have no idea where the jet planes, islands, and tigers on a gold leash are.

I have no idea where the jet planes, islands, and tigers on a gold leash are.

A new study found that millennials are the most fiscally conservative generation since the Great Depression, according to the Los Angeles Times.

Not only does this mean that we are more likely to save money, but it also means we are less likely to invest in the stock market. In fact, the study found that more than two-thirds of millennials don’t think it’s a good idea to invest.

The reason our generation is so financially risk-averse? The recent recession apparently scarred us.

“They have a Depression-era mind-set largely because they experienced market volatility and job security issues very early in their careers, or watched their parents experience them, and it has had a significant impact on their attitudes and behaviors,” said the head of investor insights at UBS, the company that conducted the study.

We, like the generations that have come before us, are not forced to take crash courses in financial planning in high school or college. But while we may have access to more financial information and guidebooks than any group of twenty-somethings that came before us, the financial consequences of messing up through a bad investment or business endeavor are far greater for us than they ever were for our parents.

For millenials, the hope of achieving the American Dream is long gone. Maybe Lorde (a.k.a. the new voice of our generation) is on to something: we are living in the ruins of the palace in our dreams.