Millennials and Gen Zers more often report wanting the help of a banking professional powered by technology
The majority (85%) of Americans say they will use digital tools to conduct some or all financial transactions after the COVID-19 pandemic, according to the KeyBank 2020 Financial Resiliency Survey. However, Millennials and Gen Zers (those under age 35) prefer a combination of digital and in-person banking more often than older Americans, who would rather exclusively use digital banking tools—a surprising discovery for technology-forward younger generations.
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More than one quarter (28%) of people under age 35 say they want to create and update a budget with the help of a professional powered by technology. By contrast, just 6% of people 50 and over said the same. Rather, 51% of people age 50 and over would prefer to create and update a budget on their own using digital banking tools, compared to 44% of people under age 35 who agree.
The 2020 Financial Resiliency Survey polled more than 1,200 Americans on their financial feelings after nearly a year of living through a pandemic, finding that 44% of people are extremely comfortable with digital banking tools, reflecting a massive shift towards digital, as our lives become increasingly virtual during the pandemic. Generational preferences in digital banking could be a result of younger Millennials and Gen Zers experiencing financial firsts—such as budgeting and bill pay—during a tumultuous year.
“The pandemic has accelerated the adoption of online and mobile banking, and consumers are increasingly comfortable with using digital tools to manage their money,” said Jamie Warder, Executive Vice President and Head of Digital Banking at KeyBank. “The advantage of digital banking tools is that they are not one-size-fits-all solutions. With widespread economic fallout resulting from the pandemic, it is understandable that younger Americans are seeking guidance from trusted financial advisors to help them navigate uncharted waters, in addition to technology-enabled services that allow them to bank on their own terms. The future of banking includes both digital tools and human expertise.”
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Digital banking proved to be powerful for helping Americans weather turbulent economic times—35% of Americans report that digital banking tools make them feel more financially resilient during the pandemic. Despite significant economic hardships faced by many over the past year, Americans’ are reporting overall increased financial confidence and awareness, with 53% of respondents saying they felt more financially confident approaching the end of 2020, and 48% saying they felt more financially aware as a result of challenges they faced during the pandemic.
The increased reliance on digital banking tools helped many Americans maintain healthy financial habits to endure economic uncertainty. As of June 2020, KeyBank’s Digitally Active clients signed on (to either desktop or mobile) an average of 20.2 times per month. Respondents plan to continue using digital tools to conduct the following transactions going forward, compared to before the pandemic:
- Insurance enrollment (41% vs. 34%)
- Creating/updating a financial plan (40% vs. 33%)
- Creating/updating an estate plan (27% vs. 20%)
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