Party Over: Will Covid-19 Finally Make Indian Millennials More Money-Conscious?

Money Matters

Party Over: Will Covid-19 Finally Make Indian Millennials More Money-Conscious?

Illustration: Shruti Yatam

Crises have a habit of bringing about behaviour changes in a manner that regular life cannot enforce. The Recession of ’08 brought about banking reform. The World Wars forced cooperation among countries tired of all the squabbling. The Black Death changed labour laws. Heck, it took the crisis of piracy for the music industry to embrace digital technology.

But nothing is likely to have the wide-ranging impact that the coronavirus is going to have – already predicted to change everything from the global economy to how metalheads behave at gigs. Many erstwhile impossible things seem suddenly likely – formalised alcohol delivery, increased work from home… And millennials learning to save.

Now, I don’t want to come across as a hater of this much maligned generation, coming from the outer limit of it myself. Those in the West, for example, are still reeling from the effects of the recession of 2009. That being said, millennials from the “middle class”, which is really the upper class in India, have had it relatively good for a while. Despite the gloom-and-doom of global news like Brexit and the US-China trade war, and domestic issues like demonetisation and the anti-CAA protests, our economy’s chugged along.

Even if it was all a carefully constructed house of cards… Thanks to some smart choices, our economy wasn’t as affected by the Great Recession as much as the US, and recovered quicker. There was, somehow, a sense of insulation, perhaps invincibility – buoyed by upward-pointing graphs and joyous headlines over the next decade, which saw the Sensex jump from less than 5,000 to over 40,000.

India’s youth was among the primary beneficiaries of the largesse of venture capital firms keen on achieving impressive targets on the back of questionable business models. We weren’t complaining. Our salaries kept rising and disposable income had been high. We got AC cab rides and home delivered food at rates well below what a standard economics textbook would advise. Foreign travel became par for the course, impulse buying and bespoke tailoring and personalised fitness classes and keto-only restaurants and alternate-day drinking and dancing… This became the reality for so many from our class and generation. Just try taking a walk down one of Bandra or Khan Market lanes on a Friday night.

Many erstwhile impossible things seem suddenly likely.

Seen as the next big market for pretty much everything, we were pampered with everything from new mobile phones to quality web content to concerts by international rock stars. Which is not to say any of these things were bad! Nirmala Sitharaman might grumble that it was our profligate ways that destroyed the auto industry, but in many ways, millennials kept the economy moving – doing all sorts of jobs. A career in comedy became viable. The number of IIMs shot up. We were still the offshore capital of the world, but now we were doing cooler things than just coding.

Many of us didn’t have to deal with the pressures that our parents and grandparents had contended with. Armed with the safety of a reasonable bank balance or a moderate inheritance like a house, we could dream of pursuing satisfying careers and passion projects.

Alas, along came a small gust of wind in the form of a global pandemic threatening to upend that house of cards. For the first time in a very long time, millennials are forced to reckon with an unsure future and it’s hitting uncomfortably close home. Stories of salary cuts or getting laid off are no longer foreign news, but things happening on our WhatsApp groups. Not a day goes by on social media without me coming across at least one “struggling to pay rent”, “clients have dried up” or just plain anxiety over job security (the latter being the most discussed topic from a webinar I conducted with a mental health counsellor recently).

As always, the data doesn’t lie. Searches for “how to invest” from India have shot up since February.

trends

Looks like India is suddenly interested in knowing how to invest!

Google Trends, “How To Invest”, India, 2018-2020

What does this mean? While it’s unlikely we will (or will even need to) resort to the penny-pinching methods espoused by our grandparents or rush to buy property, it’s quite likely some level of fiscal prudence will seep in. Especially since many of us have realised how cheap life can actually be, during the lockdown.

Panic-saving (if that’s a term) will mean less money moving around in the economy, which hurts everyone.

So it stands to reason that we’ll carry forward at least some of these habits once things return to normal. There will be more thought-through spends and less wastage. Some of us will splurge less, once we realise a night out could fuel groceries for a month (with one less hangover). Given travel outside the country looks dicey for a while, some of us might discover the joys of Hampi and the North-East at a fraction of the price of an international trip. A rush to upgrade iPhones? Maybe not. Why, with an increase in remote work, some of us might even move to a cheaper city to save on rent. Perhaps the impossible will happen – some of us might even learn how to do our taxes, actually submitting rent receipts on time instead of hoping it all gets magically taken care of (I cannot tell you the number of times I’ve facepalmed at my advertising colleagues thinking this was optional).

If that sounds like a long-overdue lesson in fiscal discipline, it’s not like it won’t bring its own problems. Panic-saving (if that’s a term) will mean less money moving around in the economy, which hurts everyone. So splurging less on a night out automatically affects the hospitality sector, and going to gigs less hurts your favourite artists. Take a look at your friends’ group and think of the things that you do that – in a way – keeps their jobs safe (BTW, thanks for reading this article). That’s how interconnected this whole damn thing is, and that’s the reason monetary policy tries to move money away from idle savings accounts to more economically useful vehicles. Hopefully, we’ll meet somewhere in the middle – where there’s prudent splurging.

Either way, there’s no doubt that the pandemic is a rude wake-up call for millennials who can’t count on the good times continuing forever. Pretty much every “how will this industry change” article you read will eventually boil down to the same few things: re-evaluate expenditure, accelerate long-pending change, chuck out thrifty habits, and do more with less. There’s no reason to think that this doesn’t apply to millennials either.

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