Last year, Nakshatra Gowda, 22, spent nearly 65% of her salary on rent during her stint as a digital marketing executive with a real estate company in Bengaluru. This was her first job and she left home to work in a different city. “I was left with only ₹ 5,000 after paying the rent and utilities. I didn’t have enough money to shop or to go out with friends. So I took help from my father," said Gowda. After six months, she realised the need for a better paying job.

Gowda is not an aberration but a norm among young millennials who have extra small budgets owing to young careers but aspirations for a king size lifestyle. Many young millennials find it difficult to fit their lifestyle within the boundaries of their salary and fall back on parents for support.

Pew Research Center defines the millennial generation as those born between 1981 and 1996.

For young workers, it is the discretionary expenditure that stretches the budget. “This generation spends a lot on purchasing electronics and dressing well," said Priya Sunder, director, PeakAlpha Investment Services Pvt. Ltd. “They spend a lot on eating out unlike the previous generation."

A February 2018 Deloitte report on Trend-setting Millennials shows that millennials in general spend more on discretionary items as their disposable income rises. Also, 32.7% expenses from incremental income is spent on entertainment, including eating out and 21.4% on apparel and accessories. Savings, in most cases, is under 10% of overall income, shows the report.

“We live in a consumerist culture and that’s where the spending comes from," said Gayatri Jayaram, author of Who Me, Poor?, a book based on urban poverty. “In post-liberalised India, you cannot expect the values of pre-liberalised India where people had big bank accounts, a house and stability."

Parental support

Arunima Chakraborty, 22, a sales executive at Le Meridian Hotels in Bengaluru exemplifies this behavioural pattern as she saves almost nothing and at times falls back on her family for support. “I run out of money and I am unable to put a stop to it," said Chakraborty who is in her second job. “There are times I am left with just ₹ 50 and you cannot expect me to survive in Bengaluru with just that much."

Parents are the most obvious rescuers of these young workers as they can’t see their child living a life which is below the quality of life they provided. “We can’t expect our children to manage with ₹ 30,000- 35,000 because we have accustomed them to a good lifestyle," said the mother of a 22-year-old, who recently joined a media house in Delhi; the mother-son duo did not want to be named. “If they are unable to afford that lifestyle, it’s our responsibility to support them," she added.

“When the children are already in their 20s, it is too late to change their thinking or living standards," said Nisreen Mamaji, certified financial planner and chief executive officer at MoneyWorks Financial Advisors. “If parents themselves are enjoying a higher lifestyle, it becomes difficult to tell their children to do with what they have. Therefore, most of them end up financially supporting the child."

Living within your means

Not being able to make ends meet could be because of many reasons, but it could also be about wrong attitude: of wanting to expand the income instead of squeezing the lifestyle to fit the income. While there is nothing wrong in wanting to earn more, it’s equally important to learn to live within one’s means and save enough for the future.

What young workers also need to realise is that parents will move from earners to pensioners and may depend on their working children for support, which makes it all the more important to get money habits right from the start.

Making the rupee stretch

A planned financial life cultivates good habits for smart money management, which is not about living Scrooge-like but about enjoying the present with an eye on the future.

According to financial planners, this can happen by cultivating the discipline to save a portion of one’s salary right from the first pay cheque. “You can put away as little as ₹ 1,000 or ₹ 2,000, which compounded over 30 years can build up to crores," said Sunder. Investing systematically is a great way of controlling the temptation to spend. “Even if you spend 85% of your salary and save just 15%, save it in something that is long-term," said Sunder.

According to Taresh Bhatia, certified financial planner and partner at Advantage Financial Planners LLP, taking stock of cash flows is the first step. “Note your income, expenses and the surplus. This is the money you need to be prudent about. Then, jot down all your short- and long-term goals and plan your investments," he said.

Making a living independent of parental support is possible for millennials if they learn to put saving before spending, and be smart about the latter.

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