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Asset Preservation Advisors


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APA’s philosophy is to work closely with our clients to develop an in-depth understanding of their unique needs and objectives. We then customize a municipal bond portfolio that best meets their specific goals and needs. APA manages high quality municipal bond portfolios in four strategies: Short-Term, Intermediate-Term, High Income, and Taxable.

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Millennials Bank on Alternative Financial Services

From pre-paid credit cards to pawn shops, even higher-income Millennials

| BY Donald Liebenson

Underbanked Millennials are subverting conventional wisdom that alternative financial services and emergency cash products are the province of low-income households, according to a recent study released by Think Finance. These 18-34-year-olds, even those with mid-high income incomes, are using these services and products at rates similar to, and in some cases higher than, their lower-income peers, the survey found:

·         Prepaid debit cards: Just over half (51 percent) of those making less than $25,000 annually reported using prepaid debit cards within the past year. The percentage was the same for those who earned between $50,000-$74.999.

·         Check cashing services: Used by 34 percent of Millennials who earn less than $25,000 as well as 29 percent of those who earn between $50,000 and $74,999.

·         Rent-to-own stores: Higher earning Millennials patronize these stores more than those making less than $25,000 (17 percent vs. 15 percent).

·         Pawn shops: These are frequented more by Millennials, who earn less than $25,000 than those who earn between $50,000-$74,999 (29 percent vs. 21 percent).

Mid-high income Millennials use other alternative financial products than their lower-income counterparts, including payday loans, cash advance and other emergency cash options (22 percent vs. 15 percent), overdraft protection (58 percent vs. 31 percent), bank direct deposit advance (37 percent vs.22 percent) and money transfer service (39 percent vs. 29 percent).

Millennials are drawn to these services for a variety of reasons, the report suggests. Among them is a lack of financial literacy. Almost one-third of investors under 40 (31 percent) surveyed earlier this year by Millionaire Corner admitted they are not very knowledgeable  about financial products and investments. This is significantly higher than their older counterparts. For example, 22 percent of those ages 41-50 said they do not consider themselves to have a good understanding about financial products and investments.

Other challenges facing Millennials include mounting debt, depleted savings, and difficulty in obtaining credit. Having come of age with 21st century technology that gives them instant access to information and entertainment, Millennials also grapple with instant gratification, which extends to wanting quick access to cash

About the Author

Donald Liebenson

Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.  

A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.