Well, that day has finally come. I have used the same phrase to my nieces and nephews that I used to cringe at when my grandfather said it to me: “You kids don't know how lucky you have it.”

But the reality was, as soon as I said it, it made me think about the evolution of money management and how things have changed over the generations.

Let’s face it, managing money is something everyone has to do. But how we save, spend, and think about money has changed a lot over the past few generations. This change has been driven by new technology, the economy, and different attitudes in society.

Therefore, I thought for this week's topic it would be interesting to look at four different generations to highlight just how much things have changed.

The Silent Generation (born 1928—1945)

Playing it safe

This generation grew up during the Great Depression and the Second World War, a time of great hardship, with little money and resources being rationed. This uncertainty dictated their approach to money, which developed into being thrifty and conservative.

Key money habits:

• Saving for a rainy day: having lived through tough times, they believed strongly in saving money and were very careful not to waste it.

• Safe investments: they preferred to keep their money in safe places, like savings accounts or property. They were often wary of investing in publicly traded shares, as many had witnessed first hand the collapse of the stock market.

• Avoiding debt: they saw debt as a risk and tried to avoid it. The only exceptions were for big, important things like buying a home.

• Financial independence: they believed in being financially independent through a steady, reliable job. They often stayed with the same employer for many years, valuing loyalty and job security, as opposed to chasing something better.

Impact and legacy:

The Silent Generation's prudent approach to managing money laid a solid foundation of healthy financial habits. Many of them amassed substantial savings and multiple property ownership, which offered stability and security for their families. This generation is frequently credited as the original builders of intergenerational wealth.

Baby boomers (Born 1946—1964)

Age of prosperity and expansion

This generation grew up in post-war prosperity. Baby boomers experienced unprecedented economic growth, which influenced their approach to money.

Key money habits:

• Consumerism and investment: boomers embraced consumer culture, with a focus on homeownership, cars, and higher education. They began to invest more actively in stocks and mutual funds as the economy expanded.

• Credit and debt: this generation became more comfortable with borrowing, taking out mortgages, personal loans, and credit cards.

• Retirement planning: as they entered middle age, boomers started to focus on retirement savings, often through employer-sponsored pension plans and individual savings accounts.

• Financial innovation: they witnessed the rise of financial products and services, including the growth of the stock market, mutual funds, and early financial advisory services.

Impact and legacy:

This generation focused on buying property and making investments to build their wealth and also benefited from being the first generation to receive large inheritances, which added to their financial security. Despite this wealth, baby boomers are also known for their generosity. They are consistently one of the most charitable generations, frequently making significant donations to charities and creating financial gifts for their grandchildren.

Generation X (Born 1965—1980)

Pragmatic and self-reliant

Generation X grew up amid economic uncertainty, rising divorce rates, and the convergence of the digital age. Their approach to money management reflects a pragmatic and independent attitude.

Key money habits

• Financial self-reliance: having observed the financial struggles of their parents while growing up, Gen Xers tend to be cautious and self-sufficient in managing their finances.

• Diversified investment strategies: they are more likely to invest in a mix of stocks, mutual funds, real estate, and, increasingly, digital assets like cryptocurrencies.

• Debt management: while more comfortable with credit than previous generations, they tend to be cautious about accumulating debt, especially in areas like student loans and credit cards.

• Focus on educational savings: as university attendance became more the “norm”, Generation X was the first generation to rely heavily on student loans. This personal experience with debt led them to a key goal: saving for their children’s education to prevent them from facing the same financial strain.

• Focus on long-term retirement savings: Generation X focused on retirement savings early and took advantage of employer-sponsored pension plans and prioritised additional voluntary contributions as a forced savings method.

Impact and legacy:

Generation X's pragmatic approach, combined with digital literacy, has helped them adapt to the changing economic landscape. They are resourceful, hard-working and their approach to money management is focused accumulation and self-reliant retirement.

Millennials (Born 1981—1996)

Digital natives, financial innovators

Millennials grew up during a time of fast-changing technology, economic problems, and new ideas about money.

Key money habits:

• Digital-first approach: as true digital natives, millennials rely heavily on online banking, investment apps, and social media for financial information and decision-making.

• Student debt and housing challenges: many entered the workforce with significant student loans and faced high housing costs, influencing their saving and investment habits.

• Values and priorities: they tend to value experiences over possessions, leading to different spending patterns. They are also more socially conscious, often supporting ethical investments and sustainable businesses.

• Financial uncertainty: the 2008 recession and the Covid-19 pandemic have created economic uncertainty, affecting their ability to save and plan for the long term.

• Innovative financial products: millennials are more open to fintech solutions, cryptocurrencies, peer-to-peer lending, and robo-advisers.

Impact and legacy:

Millennials are reshaping money management by embracing technology and prioritising financial education. Their approach may lead to more inclusive and innovative financial services.

Although this article captures only four generations, the generations after the millennials continue to evolve in their money-management techniques.

At the end of the day, the lessons learnt from previous generations can help us all achieve better financial literacy, develop smarter investment strategies, and create more resilient financial plans.

To build a more secure financial future for everyone, it will be crucial to embrace new technology, encourage open conversations about money across all ages, and make financial education a key priority.

• Carla Seely has 25 years of experience in the international financial services, wealth management, and insurance industries. During her career, she has obtained several investment licences through the Canadian Securities Institute. She holds the ACSI certification through the Chartered Institute for Securities and Investments (UK), the QAFP designation through FP Canada, and the AINS designation through The Institutes. She also holds a master's degree in business and management