Younger generation’s search for financial freedom

Brands and businesses need to understand that the typical communication of safety, security and saving for retired life does not engage this consumer. They need to move from the narrative of functional and emotional fulfilment to a third dimension of experience

Wednesday, 2 June 2021

Npuni is 22 years old and an undergraduate from the University of Sri Jayewardenepura. She has started three businesses on Instagram – for clothing, fashion accessories and small pots. She firmly believes that she should not depend on one source of income. She will soon do a job, but she emphasises that she will not let go of her online businesses. 

Asanka is a 23-year-old and from Kurunegala. He is currently working at a private construction company in Colombo. He gets an adequate salary to manage his daily and monthly expenses. However, he is currently roughing it out and not living his aspired lifestyle. Therefore, he is now looking to create an additional income in order to live the life he seeks. He is looking to start a small hardware store so that he can start earning additional income. 

Today’s youth are looking to achieve financial freedom fast! They are no longer willing to wait for a steady, organic path to take them to financial freedom but instead are looking to catapult and leapfrog their way to financial success.

We are all aware that the youth no longer rely solely on safe and stable career paths to get them to financial freedom. They are expert multitaskers, juggling between multiple jobs and multiple career changes as they try to navigate their own path to financial freedom. We see this all around us. 

We have heard the stories of people who quit their job to start their own business at a young age, or someone who starts a YouTube channel right after graduating from school and not to forget that almost everyone side hustles with freelancing, part time jobs and online businesses. This generation uses cherry-picking as a strategy, where they carefully assess the value of each step and choose only those that are lucrative and beneficial to them. 

In order to understand why they are in such a rush to create financial freedom, let’s first understand what financial freedom means to them.

What does financial freedom mean to this generation?

This generation see themselves as the ‘architects’ of their lives and live by the philosophy, “I design my own journey”. Money is seen as a necessary tool that aids them in designing the life they want. 

Even though each person wants to design their own unique lives, there are some common threads that run through this generation:

1. They value experiences 

For both the Millennials and Gen Z, experiences rank high on their priority list. For example, Gen Z in UK ranked “travelling and seeing the world” as most important when thinking about how they spend their money (65%) and saving for ‘life’s biggest investment’ (property) came a close second (60%). 

2. They seek independence

The younger generation wants to achieve independence fast. They want to control their lives and not have others dictate what they do and when they do it. This is why many aspire to be entrepreneurs over the stability of a corporate job as they want the independence to dictate their own life instead of working on someone else’s schedule.  They also want to be able to make life decisions without being overly stressed about the financial impact. They want to control their finances instead of being controlled by their finances. Financial freedom is of high value as it gives them the independence and freedom to choose.

3. They are unwilling to let their current financial position dictate their future aspirations and are anxious about not living their aspired life

This generation is more exposed to global trends and wider possibilities than any other. They dream big and want to experience more and create more aspirational lifestyles. However, they recognize the gap between where they are and where they want to go. They are lacking knowledge, guidance and resources to close that gap. 

One might say that this is a global trend that will take years to reach Sri Lanka. But, if you pay attention there is a lot of evidence that it is already happening here. For example, many young people choose to skip a traditional university degree to do a more fast-tracked marketing or management diploma or degree. Many have opted out of the corporate world to run their own businesses. Many freelance and do other jobs to build a secondary income while working their 9-to-5 job. These are happening and they are certainly not an urban phenomenon. 

What does this mean for brands and businesses catering to this generation?

Brands and businesses need to understand that the typical communication of safety, security and saving for retired life does not engage this consumer. They need to move from the narrative of functional and emotional fulfilment to a third dimension of experience.

Brands need to partner them to enable them to live their aspirational lives. This generation seeks independence so it is important that they feel they are in the driver’s seat, while the brand can guide and help them as they steer their own path.

(The writer is an Associate Partner at Quantum Consumer Solutions Ltd.  He has 12 years’ experience in consumer behaviour understanding and has worked with a wide range of clients in building their brand strategy.)