Millennials are tightening their grip on their finances and embracing digital to prepare for the future
- 62 per cent of Singapore’s millennials are embracing digital as they find it more challenging to manage their money day-to-day, with only 18 per cent feeling in control of his/her own personal finances
- The uptake of digital tools for day-to-day money management has been the highest amongst millennials compared to the older groups – and this is expected to continue in the next three years. 98 per cent are already using a mobile online banking app and 24 per cent are starting on a new money management or budgeting app since the pandemic began.
- Across a plethora of financial goals, millennials are actively pursuing future financial objectives such as saving for retirement (45%), improving how they track and budget their spending (41%), saving for major purchases such as a new car or home (32%) and wanting to invest better (32%)
There is no group more impacted by the COVID-19 pandemic than the millennials. It has galvanised this generation to be more careful with how they manage their money to better prepare for their financial future, according to Standard Chartered’s latest global survey.
The study of 12,000 adults across 12 markets – Hong Kong, India, Indonesia, Kenya, Mainland China, Malaysia, Pakistan, Singapore, Taiwan, UAE, the UK and the US – is the third in a three-part series, looking at how COVID-19 has transformed consumers’ way of life, and what changes could be here to stay. While the first survey focused on the pandemic’s impact on earnings, and the second looked at changing spending habits, the final survey provides new insights into how the global health crisis has altered the way people are managing their money day-to-day, in pursuit of their long-term goals.
In Singapore, 62 per cent of millennials are embracing digital as they have found managing their money day-to-day more difficult since the start of the COVID-19 outbreak, compared to 53 per cent of those aged over 45.
27 per cent of Singapore’s millennials also reported that their borrowing has increased in the last month, compared to 15 per cent of those age over 45.
Despite these significant challenges, 38 per cent of Singapore’s millennials are embracing digital as they are more confident that they can achieve their long-term financial goals than they were before the pandemic started. Across a plethora of financial goals, 45 per cent Singapore’s millennials are saving more for retirement (compared to 44 per cent of those over age 45), and 32 per cent saving for a major purchase such as a new car or home (compared to 13 per cent of those over age 45).
To meet these ambitions, Singapore’s millennials are embracing digital to better track and budget their spending (41 per cent); alter their daily spending (43 per cent); and out of which, 24 per cent have already started using a new money management or budgeting app since the pandemic begun.
In contrast, only 25 per cent of those over age 45 in Singapore feel more confident they’ll reach their financial goals, with those over 55 the least confident about achieving their financial goals since the COVID-19 outbreak began. When citing their biggest concern when it comes to reaching their financial goals, uncertainty around income is the most common worry across all generations.
Meanwhile, the pandemic has also made everyone more careful with their saving and spending and less likely to splurge. When asked what they would do, if given the equivalent of £1,000 by their Government with no strings attached, the most common responses globally were to use the money to pay off debt, cover day-to-day expenses or save for the long-term. In Singapore, people were most likely to hold onto the money, keeping it in their bank account in case of emergency.
Dwaipayan Sadhu, Head of Retail Banking Singapore, said: “Banks have a role to play in simplifying the saving and investment process to help consumers better visualise their financial goals and manage their money. This year, we have seen a boost in the usage of SC Money Manager, our personalised financial management tool, since it was launched in September. One out of two of our SC Mobile banking users are actively using this tool and we expect this number to grow, as more consumers look to better track and budget their spending and alter the way they manage their money.”
The survey showed that COVID-19 changed our financial habits: “Our survey of 36,000 consumers across Hong Kong, India, Indonesia, Kenya, Mainland China, Malaysia, Pakistan, Singapore, Taiwan, the UAE, the UK and the US reveals how people are adapting to the pandemic and at which pace they are embracing digital technology.”
- A new generation in search of new solutions
- The shift from physical to digital banking picking up pace
- Crisis sparking a more mindful approach to money
COVID-19 has created a perfect storm of disruption and prompted companies to think about what they must do to survive and thrive. Almost two-thirds (64 per cent) of consumers expect their country to go cashless, with almost half expecting it to happen by 2030.
Across all major consumer categories, consumers have moved away from in-person card or cash payments and almost half (48 per cent) will prefer online payments in the future. Consumers are adopting and expect to adopt new methods of paying, tracking and managing spending online as COVID-19 has made 75 per cent more careful with spending. Spending more carefully and consciously: this shift is occurring as consumers are being more careful and conscious of their spending decisions. India and Kenya are leading the charge with more consumers wanting to shop sustainably, locally and with small businesses.
A 10-minute online survey of 12,000, 18+, nationally representative respondents across 12 markets – Hong Kong, India, Indonesia, Kenya, Mainland China, Malaysia, Pakistan, Singapore, Taiwan, UAE, the UK and the US – was conducted between Friday, 25th September and Thursday 1st October 2020.
Results are weighted on the latest national census in each market by age, gender and macroregion and should be considered representative of the online population.