Empirical data shows that 60% of millennials have little or no savings. In other words, the marginal propensity to consume is equal to 1. This means that they are consuming all of their income and are probably dissaving (negative savings). Luring and appealing adverts by credit card providers and e-commerce merchants like Amazon, Alibaba, Jumia & konga are changing traditional consumer behavioral patterns. Hitherto debt and borrowing were considered an abomination in most traditional Nigerian societies.
In 2018, some baby boomers and most millennials believe that being in debt is cool and the more you owe the better. That is why the outcome of the second meeting of the MPC, in which interest rates were left unchanged, must have upset a lot of the youths whose debt service burden is going to remain high.
In this edition of the Unity Bank Digest look out for an amalgam of social and business topics such as the implications of the MPC meeting, tips for improving financial literacy and the 70th Emmy Awards.
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