On January 29th Sensis and ThinkNow Research presented the findings from the third wave of their Hispanic Millennial Project. Previous iterations reviewed this important segment’s demographics, psychographics, buying power and attitudes toward key issues such as health, diet, exercise and health insurance. The third wave examined the Hispanic Millennial’s thoughts on finances and compared them to other segments in the US market.
Why this cohort? Their numbers alone dictate marketing attention. According to Geoscape, Millennials account for one-fourth of the Hispanic age cohort in the United States. In 2013, Millennials were second only to Generation Z. From another perspective, 21% of all Millennials are Hispanic and this is expected to reach 23% in five years.
In several key DMAs, Hispanics represent the majority of the Millennial population. These markets include the usual suspects of Los Angeles, San Antonio, and Miami-Ft Lauderdale. Non-traditional markets will see the fastest growth for Hispanic Millennials, including markets in North and South Carolina, Georgia, Tennesee, and Kentucky.
Regarding finances, Hispanic Millennials (HM) see money as a means to an end – but not the end itself. Younger Hispanics follow a more pragmatic approach to their finances, and tend to shy away from “irresponsible” behaviors. The researchers stated see a conscientious approach to finances, with hardships of the recent recession still fresh in the mindset of Hispanic Millennials.
The HM group is largely self-sufficient, with over half (57%) contributing to their household’s income. Spouses or significant others account for an additional 37%. Collectively, the HM group sees wealth as meaning having enough money to enjoy a stable life. Needs must be fulfilled, but not through overspending. Wealth is viewed as an equation which combines both material and non-material things – money as well as happiness in relationships and personal characteristics.
They save for the future. The HM group strives to save at least one-fourth of their monthly income and has the lowest percentage of members who report they are unable to save. This also shows up in their attitudes toward debt: Hispanic Millennials are more debt averse than their parents and other older Hispanics.
In regard to financial services, members of the HM group showed a more favorable opinion of their banks than did other cohorts in the study (Hispanics 35-64 and non-Hispanic Millennials). Financial institutions, if they want to capture a share of the HM wallet, need to show a strong connection to their community and be innovative. Hispanic Millennials are open to non-traditional banking as provided by organizations such as USAA and Capital One.
Key takeaways from this study include the recognition that Hispanic Millennials are open to new thinking around finances, but they need education and guidance. Do not expect them to take on debt, as they are more averse to it than other generations. Country of origin (U.S. versus foreign-born) has an impact, as foreign-born Hispanic Millennials are more financially cautious than their US-born counterparts.