3 Money Habits Millennials Think Are Normal — but Are Keeping Them Broke
Written by
Laura Bogart
Edited by
Kristen Mae
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Millennials have been through a lot. This is the group that simultaneously survived ’90s boy bands and waiting for AIM messages from their crushes, while also contending with more serious issues like global recessions. Worse, a variety of smug pundits placed the blame for the widespread economic woes square at their feet — somehow, a generational love of lattes and avocado toast was the downfall of the world.
While it has since been proven that skim half-caf lattes didn’t wreck the economies of every major nation on Earth, that doesn’t mean Millennials didn’t pick up some unfortunate money habits that are still costing them big. Though some of these behaviors have become normalized, they’re keeping Millennials from achieving their full financial potential.
Spending According to Their Values
This isn’t an inherently bad thing — far from it. Buying from local vendors instead of big-box retailers, especially if those retailers support social or political causes that work against your community, can be a powerful way of using your dollars as your voice. But sometimes, insisting on only buying organic food or craft beer — or, yes, that fancy espresso instead of the on-sale drip coffee — can dilute your savings power into decaf.
According to a report from National Debt Relief, one of the most common and costly habits among Millennials is a willingness to spend more on certain lifestyle items or conveniences, such as same-day delivery, instead of going for the cheapest option. They’re also willing to spend more for experiences that support personal growth, like wellness retreats or boutique fitness classes.
Living With Financial Anxiety
When Jenius Bank examined the money mindset of Millennials, it wasn’t surprising to find that more than half of those surveyed said their generation experienced greater financial anxiety than others. After all, this generation has weathered a recession and a series of unprecedented global events that left many feeling skittish about their security.
Sometimes, this fear about what they had in the bank — or, rather, didn’t have — led to a skewed perception of their financial reality. Many Millennials are actually doing better than they think they are.
This distorted perception, sometimes called “money dysmorphia,” can put Millennials in a position where they’re hesitant to take wealth-building risks — like investing — because they think it’s only for rich people. Money dysmorphia can lead to counterproductive financial behaviors, such as hoarding cash in standard checking or savings accounts instead of using high-yield savings options.
Being in a constant state of anxiety can make it difficult to think creatively or strategically about money.
“According to a report on the topic, approximately 41% of Millennials experience some form of money dysmorphia or a flawed perception of their financial situation,” writer Julie Guntrip said. “Money can become an all-consuming concern that makes it difficult for individuals to live their lives in a healthy and productive way.”
Not Being Proactive About Debt
If there’s one thing that bonds Millennials together — well, aside from nostalgia for MTV’s “Total Request Live” — it’s debt. National Debt Relief reports that in 2024, roughly 56% of surveyed Millennials said that debt other than housing was a real problem. Around 25% of respondents said credit card debt, specifically, was causing them stress.
While some forms of debt, like student loans, have been difficult for Millennials to avoid — especially given the predatory loan terms that were offered to college freshmen who lacked financial literacy skills — other types of debt may be more manageable. For example, calling your credit card companies or other creditors and asking to work out a new repayment plan or reduced interest rate can be surprisingly effective.
There are also agencies that negotiate with creditors on your behalf, or options for debt consolidation. And even the dreaded student loan servicer may be open to an income-based repayment plan. You just have to take the first step and reach out.
Bottom Line
Millennials may have been unfairly blamed for a lot, financially, but that doesn’t mean that they’re immune to forming bad habits, like focusing on feel-good purchases instead of thriftier buys, getting mired in money anxiety, or failing to take charge of their debt. With a few mindset shifts and some proactive steps, Millennials can break free of these habits and start building real financial momentum.
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