For the past few years, there have been numerous trending posts and articles about the economic crisis faced by millennials and younger generations. It seems that young adults in their working age find it increasingly difficult to reach the level of lifestyle of their predecessors. Some simple achievements like property ownership, debt-free life, long-term investments, and now even gas and electricity availability seem almost unattainable with the current wage trends. As a result, according to surveys and reports published by companies including Fidelity Investments and Bankrate, millennials tend to spend their potential savings on more short-term expenses such as luxury items and travel. Interestingly, these are the spendings many in the past chose to avoid to save money. It may be unwise to spend rather than save and young adults may need to reprioritize their values. But perhaps it's the system that needs to change instead and provide a suitable environment that would once again encourage “old habits” in today’s generation.

Before deciding how to distribute one’s resources between saving or spending, one should  learn to classify their investment strategies and evaluate the benefits and risks of each one. Asset management is essential for any type of capital budgeting, which has become more necessary with the pandemic sparking a global surge in young investors. Cash, bonds and gilts, property, shares and commodities are the five basic terms anyone who wants to be financially literate has to become familiar with. Exploring the risks and benefits of each one may reveal the underlying cause of the tendency to spend liquid cash (or liquid assets) among young adults.

It doesn’t take much to come to the conclusion that for the past few years, every market has almost certainly been dangerously unstable, if accessible at all. The risks of each class of investments suggest that the current state of economy is utterly unfavorable for young investors: low capital prevents entry into the property market or the market of governmental loans, an unstable economy ties the hands of brokers and traders, while geopolitics and more frequently occurring natural disasters make investments into commodities an ill-advised decision. Young adults are essentially isolated from what the “big guys” are up to, leaving cash distribution as their only reasonable option for potential investments.

Although real estate could be described as stable in the long-term due to the simple truth of an increasing population and the need for a roof over their heads, it also stimulates a further rise of housing prices. As essential to life as it is, both for an individual and for raising a family, the housing market is perhaps one of the biggest worries to young adults. One can’t help but feel like they just joined the last stages of a game of Monopoly, with the wealthy buying up property in bulk and not willing to trade in general. The living costs also increase, while the minimum wage stays the same; real estate prices are measured in millions, while salaries barely cross the six-digit mark and only for the more fortunate.

With the housing market being practically inaccessible, investments being considered dangerous, and the overall rapidly changing state of the world, the tendency to spend cash before it devalues to crumbs seems like a logical decision. Purchases of luxury goods, travel, or fine dining can easily increase one’s social status among peers, quality of life, and general happiness. But this is at the expense of a stable post-retirement future, and to absolutely no one’s fault as it seems. As complicated as the problem may seem, if you take away the restrictions of the real world, the solution seems quite simple. Taking multiplayer games as an example, when a game server with limited resources gets overpopulated with new players, the server restarts with a brand new map to play on with everyone on the same level yet again — called a “wipe”. Occasional wipes ensure that new players can also build and have fun without the “big guys” monopolizing every single resource. This measure is too extreme and even communistic for the real world — but can’t we implement simpler, softer measures to ensure fair play? Perhaps a limit on how much property one can own, or taxes or donations that can be paid by the more fortunate to allow for future generations to thrive without needing to just survive? It seems the experienced and the young are separated by wealth and possibilities, and maybe it is natural too. The question is, is passing down the torch possible in today’s real world circumstances before it’s too late, or will it have to come down to a brawl?