Financial Security Tops List as Number One Life Goal
March 4th 2020 | Categories: Budgeting & Goals |
According to the research, 77% of the Australians consider financial security as their top life goal as compared to 49% placing owning a house as the top life goal and 37% with having a family as the top priority in their life.
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Evolution of Life Goals Over Time
Life goals, their significance, and their rankings have undergone a radical evolution in the past couple of decades. The generations have changed and, with that, the definition of what is important and what is not has changed too.
- The new generation of Millennials has an absolutely different ideology about goals, dreams, and aspirations. They are wittier and more informed, but at the same time, they are also more self-centred and inwardly oriented.
- While the older generations concentrated more on creating wealth and sustainability for their children and successors, millennials are more inclined towards living a well-rounded life, with greater emphasis on their own happiness and fulfilment of physiological, psychological, and emotional needs.
- This shift in behaviour and attitude has led to the transformation in priorities and life goals. The newer generation does not believe in accumulating debt to safeguard the future of their offspring’s. Instead, they are more determined towards having a successful career, travelling, retiring early, being debt-free, managing money well, and living a wholesome life with a good work-life balance.
- Therefore, the top life goals have shifted from owning a house, starting a family, and saving towards the property to absolute financial security.
What Does Financial Security Mean to You?
Financial security is generally defined as the state of mind wherein you are at peace with your finances. You would not be worried if your income is enough to cover your expenses. Financial security also encompasses having enough money to cover contingencies and emergencies and to meet future financial needs.
Thus, financial security does not necessarily mean having a lot of money; it simply means that you have enough money for your present and future needs and don’t need to worry about your finances. Instead, financially secure people can focus on more substantial things in life rather than staying trapped in the cycle of managing income and expenditure challenges.
The definition of financial security explains that to be financially secure we don’t need more money. Rather, we need better money management skills, financial management tools, financial advice, investment planning, and financial planning.
What is the New Generation Doing to Achieve Financial Security?
As is evident from the results of the research, the newer generation of Australians is referencing finances in a different light. The younger generation considers financial security more significant than owning material things and saving for the successors.
The current generation is not only aiming at financial security as their primary life goal but also taking steps to inch closer to this purpose in life. Here are the few things that the younger individuals are doing differently from their older counterparts for a better sense of financial wellbeing.
- Involvement with Superannuation Funds: The Australian millennials are way more involved with superannuation funds now than in the past. In the decade from 2007 to 2017, the share of millennials in the superannuation fund balances more than doubled from 6.4% to 14.6%. Superannuation assists millennials in being prepared for their retirement and is equally suitable for saving, investing, insurance, and tax benefits.
- Being Financially Conscious: Millennials differ from the previous generations in being more financially conscious. They believe in the sharing economy and save more by spending less on things that they don’t consider necessary, to attain financial security as early as they can. The financial consciousness is evident in the increasing concept of home renting rather than homeownership, car-hiring rather than buying them and sharing resources.
- Reducing the Accumulation of Debt: Debt is one of the most exasperating causes of financial anxiety. It hinders the very essence of financial security like no other, causes financial stress, reduces work productivity, and has an overall negative impact on the financial wellbeing. Therefore, the current generation is taking all measures to get released from the debt-burden accumulated by their parents and grandparents and to ensure that they don’t accumulate debts of their own.
- Seeking Financial Advice: The new generation of Australians does not shy away from seeking advice from experts to achieve their goals in life. We have seen an increase in millennial clients who seek our advice to develop a strategy to reach their goals and dreams and reach financial security. Their financial plan considers all areas of your life and includes tax-planning, cashflow management, debt management, insurance planning, and retirement planning. Such sound and pre-emptive financial planning will allow you to be prepared for contingencies and remain financially safe and secure.
All-in-all, with the advent of time and ages, life priorities have undergone an enormous change. The lifestyle, focus and needs have all transformed, and so have the means to attain these goals. While the older generations were more focused on building wealth, owning a house, owning a car, and being successful at work, the new generation is more inclined towards achieving peace of mind, happiness, and balanced life. Therefore, financial security and the peace that comes with it have become the number one life goal for the majority of the Australians.
Speak to us today about creating financial security in your life.
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What you need to know
This information is provided by Invest Blue Pty Ltd (ABN 91 100 874 744). The information contained in this article is of general nature only and does not take into account the objectives, financial situation or needs of any particular person. Therefore, before making any decision, you should consider the appropriateness of the advice with regards to those matters and seek personal financial, tax and/or legal advice prior to acting on this information. Read our Financial Services Guide for information about our services, including the fees and other benefits that AMP companies and their representatives may receive in relations to products and services provided to you.
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