The Street published an article yesterday that didn’t mince words: “Banks Have No Idea How to Handle Millennials”. The article basically highlights key points of a study that show which facets of banking my generation loathes the most – lack of mobile features, fees, not understanding our situation, and so on. It’s an interesting read for those who either are Millennials themselves (also deemed Generation Y) or otherwise.
Since I’m on the earlier edge of the Millennial age group, I can speak to issues my generation has with banks today. While I don’t necessarily agree with all of the points in the study – I think it largely depends on the bank itself – it did get me wondering what I would tell a CEO of a major bank if I had the chance to speak with him (or her).
Dear Banking Industry,
I’m sure you’ve thrown millions of dollars at the problem of determining what it is, in fact, that my generation wants from you. What we ultimately want is for you not to try to take advantage of us. To think that we’re stupid. Sure, there’s plenty we need to learn about personal finance since we never learned it in schools, but trying to hide it behind having to speak with one of your “banking specialists” who are really only specialists of the products you are trying to shove down my throat makes me never want to walk into a bank. Ever. I will do everything in my power to use my bank’s mobile app, ATM machines, and website to not have to set foot inside. In fact, in the last year I’ve only gone in there to get a bank check for a car and exchange $10 bills for quarters to do laundry.
In an age where I can YouTube how to fix or do virtually anything, you have got to make finance simple again. Leave your egos and your products at the door, and show us the basics. Then let us connect the dots. Let’s be honest – this isn’t just a problem with my generation. This is a problem every generation has right now. No one understands the finance industry. One person thinks it’s just fine, the other thinks it’s a house of cards ready to fall down (again), and a third probably keeps all of her money hidden throughout her apartment because she doesn’t want to pay fees. Stop trying so hard to make a buck and think about the long-term potential we have as customers. We’re in our 20s and early 30s now – you could have us for at least four more decades if you do it right. There’s a lot of things that we may be naïve about, but one thing we know for sure is that you’re in the business of making money – not just protecting mine.
Speaking of four decades from now – I am tired of seeing how much money I should save in order to have a “good” retirement. Do you know what I want for retirement? Do I even know what I think retirement will look like for me? Not really. I’m busy trying to either start my career or pay my bills. Stop trying to shove a magic number down my throat when, quite honestly, I don’t know what it is I want to do four decades from now yet. Do I know I should be saving money? Sure. So show me the best way to spread what little money I have to save across investments that will help my money grow faster than the pitiful .119% savings account rate for accounts with $2,500 and even worse CD rate average of .113% (for a three-month CD). When you try to tell me how I should live my retirement, it makes me think about what that would actually be. And when I don’t have the answer to it, it makes me not want to save for retirement. Paralysis by analysis. What ultimately happens is that I don’t start saving for that because it’s something way off in the future I don’t have a plan for. Now I’m missing out on compounding interest.
Most likely, I’m probably not setting aside money for an emergency fund either because I think that nothing bad will ever happen to me. We all think that we’re invincible. We all think that we’re too big to fail. We also have a lot of money in student loans to pay off – and with that amidst a world that tells us we need to buy a house and a car, have a family, have babies, so on and so forth, again … paralysis by analysis. Show me how I can start to ease the pain right now, then the building blocks for what I could do in the future. Does it really make sense to plow money into something that gains less than two-tenths of a percent of interest when I can pay off loans that are charging me 6% of interest, if not more? Riddle me that, and maybe I’ll trust you enough to help me in the future.
There are too many variables in life, but that’s what makes it life. We’re not one-dimensional, and neither is the world we live in. We don’t expect you to know our situation intimately unless we tell you, so don’t pretend you know brass tacks what’s best for us. Give us clear information we can easily digest, don’t pressure us into making a decision, and stop assuming we’re derelicts. Every generation has thought the one ahead of theirs was going to ruin the world. You didn’t, despite your best efforts, and we won’t either. Get over it. Realize that you will want our business for the next 40 years, if not longer. Start to nurture that now, so that when we do have more money to diversify into different products, we’ll come to you first instead of sticking it under a mattress, keeping it in safes, or spending it to “keep our economy alive”.