Dear Boomers, Talk to Your Millennials About Finances, FOMO and DebtApr 20, 2015
Have you heard of FOMO? This four letter acronym that stands for the “Fear of Missing Out” is certainly receiving a lot of attention these days, particularly regarding the influence that it has on spending decisions and even consumer debt. Perhaps not surprisingly, studies show that the most financially susceptible to this fear appears to be those in the Millennial generation. In fact, Millennials often admit to making reactive purchases due to a case of the FOMOs. Are you a Boomer with a Millennial-age son or daughter? It might be a good idea for you to start talking honestly with your adult children about FOMO and their spending habits to help them avoid any debt and financial issues that could arise as a result.
Millennials, FOMO and Debt
FOMO is changing the way that Millennials view finances and financial management, leading many in this cohort to develop spending habits that could conceivably lead them into an endless cycle of debt. As a generation constantly active on social media sites such as Facebook, Pinterest, Twitter, Snapchat and Instagram, it’s not surprising that Millennials are the group most likely to develop a serious case of FOMO. In fact, two-thirds of Millennials admit to experiencing a bout of FOMO from time to time and of those who admitted to experienced FOMO, almost half report that they are not able to go more than twelve hours without checking in on their social media feeds.
What is somewhat surprising is the fact that FOMO is causing many Millennials to become a little short-sighted when it comes to money and debt management. While previous generations opted to take on ‘positive’ debts such as a mortgage that involved an investment that would appreciate over time, research shows that Millennials are more focused on the here and now, with many racking up credit card debt in order to finance vacations, dining and other lifestyle expenditures. Attitudes towards credit are also shifting. A recent poll shows that 33 per cent of those in the Millennial generation consider credit as an additional source of spending money.
#LetsTalkFOMO : Why It’s Important to Talk About Finances, Debt and FOMO
With this new FOMO-related overspending and the potential for problems with high interest debt, it’s not a bad idea to check in with your son or daughter and find out where they stand financially. Start by discussing with them the impact that FOMO has on their purchasing decisions. If they don’t currently use a monthly or weekly budget, discussing the importance of creating and sticking to a budget is also a good place to start.
Once you have started this conversation, you may even find that your son or daughter is already struggling with FOMO-related debt. If this is the case, including a discussion about debt repayment strategies, in addition to talking about the importance of budgeting, is also a good plan. You may even elect to encourage them to engage in debt counselling through a credit counselling service in order to review all the debt repayment options available to them. If debt is truly overwhelming, a visit with a Barrie personal bankruptcy specialist, such as a Trustee in Bankruptcy could also be beneficial.
Don’t be scared to talk about FOMO and debt. Start the conversation and help them avoid future money and debt problems – #LetsTalkFOMO