A Bankwest analysis of savings goals amidst the global pandemic has revealed millennials are prioritising their homeownership dreams over lifestyle aspirations more than any other generation.
Bankwest analysed the trends of close to one million customers, comparing differences between those who had used the Savings Goal feature in the Bankwest Mobile App, and those who had not.
The data showed that, across all generations of goal-setters, millennials were not only the most focused on saving for a home but were also least likely to be setting Travel or miscellaneous goals.
The drive of millennials propelled saving for a Home to the largest growth in overall customers pursuing the goal in the six months, inclusive, from March to August, swelling by 49.62 per cent.
The growth positioned saving for a Home as the third most-common goal across customers, behind Just Saving and Travel, which held as the second most common, despite ongoing restrictions.
However, while those already saving for a holiday continued to cache the cash, the data suggested others had moved on, with Travel flatlining as the only goal with single-figure growth in the period.
The analysis also revealed the significant impact of goalsetting on savings balances, with those working towards a purpose growing their war chest at a far greater rate than those with no aim.
The data showed the average savings balance of those customers who had a goal grew by 41.77 per cent year-on-year to the end of September, compared to just 13.67 per cent for those without goals.
It was a difference that became most apparent with the arrival of the COVID-19 pandemic.
Average balances of goal-setters and non-goal-setters were near even in May before rapidly diverging, as those with a goal held about $1000 more by the end of the first quarter of the financial year.
The data also suggested one goal was all it took for customers to see a benefit to their bank balance, with little difference in year-on-year growth between those with a single goal or multiple goals.
Bankwest’s Savings Goal feature allows customers to create goals and specify a time period, then calculates the periodical deposits required, assists with recurring transfers, and provides live tracking.
Bankwest Chief Customer Officer Paul Vivian said: “We’ve known for a while through the data we see that the stereotype of millennials as carefree money wasters isn’t true, and this is another example.
“We’re in a period of unprecedented uncertainty, but also a period of low interest rates, and it seems like millennials are seeing both as a reason to prioritise saving for a roof over their heads.
“They’re not alone in re-prioritising, either, and it’s probably not surprising to see a stall in the growth in the number of customers setting Travel goals, and instead squirrelling away pennies elsewhere.
“What was also interesting was the impact on savings balances by simply having a goal, which makes sense, as not having a goal is like expecting to get somewhere without knowing the destination.”