What makes Millennials tick when it comes to money? A report among this age group in the US and Canada tries to find out.

The majority of US Millennials say that their current financial situation is their largest personal worry, according to a BMO Wealth Management US report.

Two versions of the report, both called Generation Why!, were published in the US and Canada. The bank surveyed 1,003 Millennials in Canada and 1,006 in the US on topics such as Millennial traits, personal goals, saving options, setting financial goals, life priorities and retirement planning.

Millennials are often known as the least-understood generation, with many surveys tending to focus on their being avid technology users. As wealth passes hands from the Baby Boomers and Generation X into the hands of Millennials, financial institutions need to find out more about what they want.

Around 65 per cent of US Millennials in the report cited that their current financial situation was their most concerning personal matter, more so than their personal relationships and job situations. However this differed in Canada, where they felt job security (63 per cent) was the most important, closely followed by their financial situation and personal relationships, both standing at 62 per cent. 

Retirement
According to the report, US Millennials do not view saving for retirement as an immediate priority. While around 25 per cent said they are worried about their ability to ever afford to retire, and only 10 per cent of participants said saving for retirement is their top priority. Just over a third, 37 per cent, indicated that retirement is simply too far off and that they have more immediate priorities.In addition, 22 per cent of respondents in the US said they would rather pay off their accumulated debts first before starting to save for retirement.

Across the border in Canada, Millennials are focused on short-term financial goals – 41 per cent do not consider long-term goals, like saving for retirement, an immediate priority. Only 24 per cent in Canada worry about their ability to afford retirement. And different to their North American neighbors, 19 per cent wanted to pay off their debts before saving. Around 11 per cent said they would put sufficient funds away to fund their retirement.

Concerns
The survey found that both Millennial men (37 per cent) and women (29 per cent) in the US are concerned about their lack of financial literacy. The report said that the “lack of financial expertise may have an impact of Millennials’ future financial outcomes. Only a slightly more amount of men in Canada (39 per cent), were concerned about their lack of financial literacy, whereas women in the US and Canada had similar beliefs.

BMO WM US also found that 25 per cent of Millennials think that paying down accumulated debt as their highest priority, finding better paid work (17 per cent), and purchasing a new home (15 per cent) were voted just behind in second and third, respectively.

Meanwhile, the report also found almost one third (29 per cent) of Millennials in Canada considered paying down debt as their greatest financial concern and 23 per cent highlighted it as their highest financial priority. Further, one in five (19 per cent) Canadian Millennials indicated that they would rather pay off their accumulated debts before starting to save for retirement.

"As millennials' incomes grow, financial planning and literacy will become even more important in order for them to achieve their financial goals," said Stephen Williams, senior vice president of wealth planning BMO WM US. "It is imperative for millennials to engage advisors as they start to map out their financial plans, in order to maximize their financial potential in a way that suits their current lifestyle and helps accomplish their aspirations."

Financial tips

BMO offered the following financial tips for millennials in the reports:

- Identify goals and create a financial plan: Developing even a basic financial plan can help millennials prioritize goals and determine the actions that can be taken to achieve them. Working with a financial advisor to do this is key as millennials often need additional support and guidance to make the most of their financial resources and strategize goals.
- Improve financial literacy: The right financial advisor can provide invaluable guidance to millennials in helping them quickly increase their financial knowledge in areas specific to their goals and concerns.
- Insure yourself: Unforeseen events such as illness or a death can happen at any time, even for young and healthy individuals. Insurance can help millennials ensure their plans are not derailed by disability or death, and that they are prepared for out-of-pocket expenses.