How Millennials Are Changing the Way We Save

For all the flak millennials receive, they employ money saving habits that all of us can learn from. It's a combination of their ability to navigate technology, the level of education they've received and the amount of money they make in their current jobs.

To understand where millennials are coming from, it's important to know the financial standing of the millennial generation. They are delaying home and car ownership, and putting off marriage and parenthood until they find themselves more financially independent.

Despite higher education levels (compared to prior generations), millennials are making significantly less money than their counterparts 10 years ago. And while more millennials are going to college, they're also finding themselves strapped with student loans that can take years to pay off.

[See: 10 Ways Millennials Are Changing Homebuying.]

This long era of bank failures and scant job security has forced millennials to look after themselves. "Millennials have been forced to become self-sufficient which, for many, means being self-employed," says Steve Bletlinger, chief strategy officer at Payline Data. "Combined with how tightly technology is ingrained in our culture, we are better equipped to research and share knowledge in a transparent way. This has led to a rise in entrepreneurship and the 'for-hire' on-demand economy." Given the current economic times, millennials have turned to creating their own jobs and finding unusual ways to jumpstart their careers.

[See: A Guide to Launching Your Side Business.]

Millennials have a penchant for setting aside money, whether it be in the form of an emergency fund or a 401(k). Even though baby boomers have been padding their savings account for much longer, millennials are quickly catching up. And many of these young adults are doing so by whatever means necessary. Last year, a survey revealed that 67 percent of millennials will save by any means necessary, and more than half of millennials contribute the maximum amount to their retirement funds to benefit from an employer match.

So how exactly are millennials saving? Remember, this is a generation that suffers from a mainly flat-income environment and has seen little, if any, raise at all in their paychecks over the past year.

1. They Get Roommates

It's all about small lifestyle changes. Recent college graduates just entering the workplace are looking for roommates to drive down rent costs or are even moving back in with their parents in the short term. A Goldman Sachs study on millennial habits found that nearly 30 percent of all surveyed young adults in 2010 said they chose to live with their parents and were paying for utilities and a small amount of rent. It's not as glamorous as living on your own in the big city, but studies reveal that in high-rent cities, having a roommate can save millennials up to $700 a month. For a group that's focused on saving as much as possible by any means necessary, cutting down on living expenses is a huge bonus.

2. They Delay Traditional Milestones

Gone are the days of buying and owning your own car or home; these traditional milestones are either being put off indefinitely or avoided entirely by millennials who are focused on saving. The must-haves for previous generations are simply no longer important to millennials. While their parents might be saving for a car or a home, millennials are sacrificing these major purchases in lieu of services that provide access to these same products without the burden of ownership. Think of Uber's popularity with millennials. The convenience of on-demand car service greatly outweighs the cost of maintaining a car. And who can forget about one of the biggest milestones of all: marriage. In 40 years, the median age at which people are getting hitched has increased from 23 to over 30.

3. They Embrace Technology

If there's one thing millennials are great at, it's navigating technology. While some of their parents might struggle with the apps on iTunes, millennials are employing tools like MInt and Digit to keep track of their spending habits and investments. Similarly, apps like Acorns help millennials new to finance invest a small amount of money into a diversified portfolio based on personal preferences. It's not enough to simply deposit a portion of your paycheck into a savings account. Interest rates for most savings accounts are too low to make a significant impact on your retirement fund, so millennials are turning to quick, easy-to-use tools to guide their investment plans.

[See: Your Month-to-Month Guide to Savings.]

4. They Compensate for High Education Costs

While it's true that more millennials are headed to two or four-year colleges, they're also taking on more student loans that influence their saving and spending habits. Over half of all millennials with a student loan say their financial burden impacts their ability to save, which in turn affects major life decisions like marriage and parenthood. Education costs coupled with the difficult job market have forced millennials to reconsider what they spend their money on and, in many cases, have led to millennials taking jobs they are overqualified for. Most young adults are focused on saving as much money as possible but are also motivated to pay off their student loans and get out of debt before they make any other big purchasing decisions.

With the changing times comes a shift in priorities, and millennials have different financial goals when compared to their parents. It's the result of several major events, including the economic downturn of 2008 and an increase in the number of millennials attending college. But it has led to a series of smart financial decisions that older generations might consider adopting to better serve their financial aspirations.

Josh Felber, a serial entrepreneur and high performance coach, focuses on helping people design, develop and deliver their passion and expertise to the world so they can have the time, freedom and lifestyle they want. He has co-authored two best-selling books, one with Brian Tracy and another with Steve Forbes. Josh is an Emmy award-winning executive producer of "Visioneer: The Peter Diamandis Story" and "The Rebound," a documentary on the Miami Heat wheelchair basketball team. Josh has appeared as a guest expert on NBC, CBS, ABC and Fox, and his biography was picked up by the E channel. He is a contributor to Entrepreneur.com, Inc.com, Businessinsider.com and Forbes.com. Learn more at joshfelber.com.