Millennials are changing the economic game with their spending habits—or rather, their refusal to spend on certain things.
Burdened with heavy student loan debt and other financial pressure, they have become selective about where they put their money. This article dives into 12 key things millennials are cutting from their budgets and examines how these choices impact various industries.
Homes
Owning a home is no longer a top priority for most millennials. According to a Business Insider report, 36% of U.S. millennials say their student loan debt prevents them from buying homes. Millennials, known for their practical mindset, prefer the flexibility that renting provides. They also favor smaller, energy-efficient homes in trendy areas near city centers. Their pragmatic approach has changed things in the housing market.
Diamonds
Millennials are rewriting the rules of romance as well. With most of them facing heavy student loan debts and an unsteady job market, they question the value of spending a fortune on diamonds.
Affordable and ethically sourced alternatives are more their style. Millennials also like to focus on experiences and financial security. Concerns about unethical mining practices and a preference for unique, personalized jewelry have contributed to this trend. The diamond industry is now scrambling to adapt to changing consumer preferences.
Cars
Unlike the earlier generation, millennials avoid buying new cars and gas guzzlers at dealerships and prefer eco-friendly travel. They prefer second-hand vehicles, ride-sharing services like Uber and Lyft, public transportation, and car rental programs.
The rising prices of new vehicles have also contributed to this trend, as many millennials just can’t afford to buy cars from dealerships. As Millennials continue to prioritize more sustainable and budget-friendly transportation options, it’s time for the industry to adapt to the changing needs of its consumers.
Disposable Products
Millennials, raised with a heightened awareness of environmental issues, are increasingly rejecting disposable products like napkins, paper plates, and plastic straws in favor of sustainable alternatives.
According to The Deloitte Global 2022 Gen Z and Millennial Survey, most millennials believe their government is not doing enough to address climate change. So, they are actively trying to lessen their own environmental footprint.
Millennials increasingly choose reusable options like canvas totes and metal straws over one-time-use products. They are forcing businesses to adapt and fueling the growth of eco-friendly companies.
Big Weddings
Millennials are redefining wedding traditions by opting for smaller, more intimate ceremonies instead of extravagant celebrations. They prefer cost-effective and less wasteful options like backyard venues, food trucks, and modest decor.
A survey by the Thriving Center of Psychology found that 75% of Gen Z and millennials believe it’s too expensive to get married in the current economy. Smaller weddings are becoming a norm, reflecting the practical budger-conscious approach of millennials.
Cruises
Millennials are not really into cruises. This generation loves authentic cultural experiences, which are often missing in tightly scheduled cruise itineraries. Instead of partying at these floating resorts, millennials prefer to stay at local hostels and enjoy traditional cuisines that offer a more budget-friendly approach to travel.
The significant environmental harm caused by cruise ships conflicts with millennials’ commitment to sustainable living.
A global survey revealed that Gen Z and millennial travelers are the most concerned with choosing environmentally-friendly travel options. On average, a cruise ship emits 250g of CO2 per passenger kilometer traveled—much more carbon intensity than a short-haul flight.
Stocks
Millennials are redefining what it means to invest. Having witnessed the market’s instability during the 2008 crash, they’re diversifying their portfolios with other assets like cryptocurrency, real estate, and socially responsible funds.
According to a recent Bank of America study, 75% of Americans aged 21-42 believe above-average returns are unattainable through traditional stock and bond investments alone.
Driven by the skepticism of conventional institutions and influenced by events like the tech bubble and the Great Recession, millennial investors are increasingly exploring alternative investments. This shift has forced many financial institutions to adapt to the preferences of this tech-savvy and risk-aware generation.
Designer Handbags
Designer handbags, once considered a symbol of wealth, have lost their luster for millennials, who prefer a more minimalistic lifestyle. This generation prioritizes unique life experiences over material goods and luxuries.
They prefer spending on travel, dining, and other enriching activities. For them, the idea of spending a fortune on designer handbags is a waste.
As a result, luxury brands are now exploring more affordable lines and rethinking their marketing strategies to connect with a generation that favors function, sustainability, and unique experiences over traditional status symbols.
Fine China
Forget registering for expensive fine china. Millennials prefer practical, versatile dishes they can use every day. Smaller living spaces and a minimalist lifestyle make storing rarely used formal tableware impractical.
This generation’s casual, everyday aesthetic clashes with the fine-dining traditions of the past generations. According to The Knot, only 15% of couples now register for formal table settings. This trend marks a significant shift towards functional and contemporary designs.
Postcards
Postcards or souvenirs, a favorite of Boomers, have become a thing of the past. Millennials prefer sharing their adventures instantly through social media. They believe in reducing waste and spending ethically and are more likely to send a heartfelt text or post a photo than invest in a soon-to-be-discarded postcard.
The same principle applies to souvenirs: mass-produced plastic trinkets are out, while artisanal, handcrafted goods are definitely in. For millennials, sharing experiences and supporting ethical businesses takes priority over traditional, often wasteful, travel tokens.
Cable TV
The television scene has also seen a drastic change as millennials shift from traditional cable TV to streaming services like Hulu, Netflix, and Disney+. This shift is driven mainly by the high cost of cable TV and the flexibility and affordability that streaming platforms offer.
According to a recent study by Evoca, by 2026, 80.7 million households will have shifted from cable TV, leaving just 54.3 million subscribed to traditional pay TV. The rise of on-demand entertainment and personalized viewing has left the cable industry scrambling to catch up with the evolving preferences of millennials.
Outdated Devices
Millennials are often criticized for their smartphone use, but their devices replace many items previous generations relied on, such as alarm clocks, calculators, landlines, and GPS devices. Millennials use their smartphones for multiple tasks, making e-readers, digital cameras, and music players redundant. Millennials are making the most of their smartphones by using them to streamline their lives and save money.
