• by Kipp Jarecke-Cheng , Columnist, May 26, 2017

Media types often like to portray Millennials as irresponsible and irrepressible narcissists who are more interested in squandering their paychecks on pricey avocado toast or on ill-fated music festivals held at private Caribbean islands than saving for the unforeseeable future.

The problem with this mischaracterization of a group as diverse as Millennials is that those who levy the charges against them tend to be old people who’ve forgotten what it’s like to be young. It also ignores the fact that the Millennial generation spans at least three distinct life stages, the youngest of which are too young to care about or plan for their financial futures and the oldest of which aren’t much different from the Gen Xers that preceded them.

When it comes to finances, Millennials clearly have been dealt a bad hand: Crushing student loan debt coupled with a sluggish economy have caused Millennials to organize their financial lives much differently from their parents or cohorts from older generations. For many Millennials, money is simply the means to an end. And by an end, I mean a super-awesome, #YOLO-infused life of good eats, good friends and good adventures right now (or at least in the short term). Meanwhile, many older people simply see the accumulation of wealth as the ultimate reward—and good times can wait until after retirement.

A new report from Merrill Edge illustrates some stark contrasts between generations and their respective views on financial planning. According to the report, while a majority of Millennials think of saving as a path toward financial freedom, older generations save in order to establish a nest egg for retirement. Although 55% of Boomer and Gen Xer respondents said they are saving to leave the workforce one day, only 37% of Millennials said the same thing. In essence: Millennials work to live, while older generations live to work.

The Merrill Edge report cites Millennials’ collective fear of missing out as one of the key drivers for the reprioritization of spending on life milestones among younger people, but there’s also a bigger cultural shift that’s occurring. Guided by a greater sense of personal purpose, Millennials are 42% more likely to be focused on working to attain their dream jobs compared to only 23% of older people. Moreover, rather than focus on saving for retirement, Millennials are 81% more likely to spend on travel, 65% more likely to spend on dining, and 55% more like to spend on fitness.

Despite widely held perceptions that Millennials are spendthrifts, however, it turns out they’re doing a better job at saving compared to older people; they’re just spending on different things. In fact, Millennials are saving 19% of their average incomes, while Gen Xers and Boomers are saving 14%, and seniors are saving 12%. Which is good news, considering that Millennials today are earning 20% less than their parents at the same life stage.

The good habit of saving may already be instilled in many Millennials, but older generations can learn a thing or two from young people’s embrace of living life for the now and spending on experiences over material goods. After all, he or she who dies with the most toys is still dead, so we might as well have another slice of avocado toast while we still can.