Do Millennials have a financial lesson for their elders?

Sixty percent of Americans have less than $500 dollars in savings to cover unexpected expenses, according to a new survey from consumer financial services company Bankrate. But one generation is notably better prepared.

Mark Lennihan/AP
One dollar bills dropped into a tip jar at a car wash in Brooklyn, N.Y.

The time-honored principle of “saving for a rainy day” still holds. But it’s the younger generation that has really taken the lesson to heart.

When faced with surprise expenses, just 4 in 10 Americans turn to their savings, according to a new survey from consumer financial services company Bankrate. Among Millennials, however, that figure is almost 7 in 10. Millennials are also the group most likely to cut spending to help cover unexpected expenses. Among other generations, spending on credit and tapping into home equity are popular.

According to financial professionals, saving – even if it’s only a little at a time – is the ideal. 

“If you have a car, a house or apartment, a pet, or a kid – if you’re a member of the human race – something that costs money is bound to go wrong,” analyst Jill Cornfield told PRNewswire, adding, “The best way to prepare is to have an emergency fund you can draw on.”

And it’s Millennials who seem to be following this advice most closely. Does their behavior reflect financial savvy – or just fortunate timing?

Great Recession influenced the financial behavior of each generation living through it. But its effect was in many ways more pronounced for Generation X, which faced pay freezes, a crash in home prices, and crumbling stock values. By contrast, Millennials – though their entrance to the job market may have been delayed – had few assets to lose.

Millennials were also able to learn from the types of challenges that faced older generations during the Great Recession, and adapted their spending and saving habits accordingly.

“[They have] greater hesitancy towards incurring debt, less of a consumption focus, and a greater inclination towards saving,” chief financial analyst Greg McBride previously told The Christian Science Monitor.

And Millennials, who came of age during the crisis in Social Security, are more aware than previous generations that they will likely be paying for their own retirement, Mr. McBride notes, which may add an edge of urgency to saving.

Gen-Xers, by contrast, have become the “sandwich generation,” caught between aging parents who need care and children going to colleges that are more expensive than the average family was prepared for.

“They may need to allocate their resources differently and they have different priorities when it comes to spending and saving,” Julia Clark, senior vice president and market researcher at Ipsos, explained to The Wall Street Journal.

Something else that may have been giving Millennials a leg up: delaying having children. Parents were less likely to have funds to draw on in an emergency (36 percent) than those who did not have children (43 percent), the Bankrate survey found.

Millennials may have the best attitude toward saving – and the financial circumstances to make it easy. But anyone can build their savings, financial experts told Bankrate. 

How should Americans who are feeling strapped for cash go about it? Start small and work your way up, says Paul Golden, a spokesman for the National Endowment for Financial Education in Dallas.

"Even $500 has been proven to have a psychological benefit," he told Bankrate. "It improves people's psychological well-being and shows you have the ability to set (and meet) an achievable goal.”

Carina Diamond, a financial planner in Akron, Ohio, and board ambassador for the Certified Financial Planner Board, says it’s a question of consistency.

"Every month, you put money in your 401(k), you pay off debt. Putting month in an emergency fund each month is just another monthly expense," she told Bankrate.

This report contains material from Reuters and the Associated Press.

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