WHY YOUNG PEOPLE ARE FAILING TO SAVE?
Many young adults don’t have savings stored away in a bank account. In fact, many of them don’t see the need to keep money in one mostly because it never lasts long enough to be deposited there at all. Even so, we live in an ever-changing world where tomorrow the situation could become difficult as we witnessed with the emergence of COVID-19. But before we arrive at the solution, we can first highlight and address the problem. When it comes to poor saving habits among this age group, three major factors are to be considered; the first being poor financial knowledge, unemployment and a need for instant gratification.
To begin with, the most critical information about what good financial mindsets and habits entail are rarely taught in schools or even in out of school learning experiences. Habits such as saving, budgeting and investing are barely mentioned as these individuals grow and mature into young adults. And when they awaken to the reality that they need to be better at managing their money, it’s usually a little bit later in life when financial opportunities are scarce in addition to decreased vitality and a limited time to actually pursue these opportunities.
Besides that, it is also difficult to save when you have no source of income. This is because one’s job avails them the first opportunity at building their savings and short of this; the ability to set aside money becomes taxing. Because a person is already surviving at this point any money they might receive goes towards maintaining their needs. Even though they might desire to venture into self-employment, capital will still be a requirement.
Apart from this, many struggle with foregoing their desires. After all being young means staying up to date on current trends and enjoying said youth through various activities which do cost money. But the danger in living this lifestyle in the long run is you self condition yourself to always go after your wants sometimes at the risk of depleting your savings in order to maintain said lifestyle or fit into a certain crowd. Eventually it becomes difficult to have self-control over one’s finances and supply your basic needs much less have savings.
However, there’s always room for improvement. The beauty of life is that as long as you are willing to learn and adjust no situation is permanent. With this in mind the starting point would be disseminating information on money management and other key financial knowledge to the youth from as early as age 12. This can be done through in classroom learnings and other experiences that interest young people like clubs, sports, entertainment publications and TV programs. The idea is that if this information is circulated early on and consistently through a young adult’s life, it can enlighten them and eventually influence their money habits.
For this reason personal discipline should also be considered. If a person can’t hold themselves accountable especially when it comes to budgeting and tracking expenditures, it blocks them from learning about commitment and overall developing trust with self. Ultimately this affects one’s capabilities and goals in regard to saving.
Finally, it’s also important to learn how to do without certain wants and politely swear off some things for a while. As a measure to avoid living in constant debt or unpreparedness during emergencies.
In the end, this poor saving culture works to the detriment of the young people and adopting a better understanding of money plus cultivating good financial habits will go a long way in achieving a better standard of living.
