How banks can help millennials into the financially independent future
There are countless personal finance movements that have evolved since the pandemic and many of them are picking up steam with millennials. One of these is FIWOOT, which stands for Financial Independence, Work On Own Terms. Banks and credit unions can be valuable partners by helping guide customers who seek the FIWOOT lifestyle.?
The backstory: Millennial Shift
Because of the Covid-19 pandemic new characteristics about the millennial generation became evident. For instance, they value authenticity, flexibility and self fulfillment. As with most of the working population, the pandemic caused a reset and a focus on work and life balance (or in some cases, lack thereof) for millennials. This reset is reflected in the trend of millennials moving to suburbs to be closer to family and the major increase in demand for jobs that offer flexible work arrangements.
“I feel like our decision [re: to move to the suburbs] was 100% affected by Covid. We saw what fearing for your life in a big city being so close to people was like and were like….yeah no thank you. We went from not wanting a yard to definitely wanting a yard in like 3 months,” says a member of the Banktastic National Millennial Advisory Board.
“I have the option to be hybrid but am choosing to be fully remote. I feel that WFH has a tremendous impact on my satisfaction with my job, stress levels, and work/life balance,” says another board member.
Millennials are currently the largest generation in the US labor force. Ages 29-45, they’re working adults, many with families and all with responsibilities. The pandemic has allowed them to see that the flexibility to spend more time with family and friends and the ability to pursue their passions are major priorities for them. Enter FIWOOT.?
The right now: Why FIWOOT?
It's likely that you’ve heard of the FIRE movement (Financial Independence, Retire Early). The goal of the FIRE lifestyle is to gain financial independence by saving and investing as much as possible to retire earlier than the societal norm. Alternatively, the goal of FIWOOT is to reach a level of financial stability that allows people to continue working but on their own terms, most often in a more flexible and purposeful line of work. This can range anywhere from a few hours a week to a full time job, but the idea is that the individual isn’t reliant on a full time salary to live.
“I’m attracted to the FIRE movement, but more specifically something like FIWOOT. I hope to achieve financial comfort that lets me choose flexible, meaningful work that I can do for 20 hours per week. I wouldn’t feel the need to retire from this kind of work,” says a member of the Banktastic National Millennial Advisory Board in a recent study.
Another board member says, “I think what resonates the most with me is having the mental freedom to do what I love versus a job that just pays the bills. I’d love to reach FI and then start spending more time giving back.”
The idea is that this freedom and being able to partake in personally fulfilling work would eliminate the need to retire at all. This changes the way millennials in this movement look at banking and saving for retirement. This is an opportunity for financial institutions to be a part of that change.?
The Future: FIWOOT and You
It’s crucial to understand the spending and saving habits of your millennial customers. Banks and credit unions can help them to reach financial independence by delivering the products, services and education they need.?
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Banktastic? is a marketing agency for financial brands. We build outcomes-based programs that build love, loyalty and profit. Our National Millennial Advisory Board of nearly 400 diverse people from across the country is a resource for our clients and the content we share. ? Want to hear what millennials think about your bank or credit union products and services? Let's talk: [email protected]