At the same time that marketers and politicians alike are falling all over themselves to court the millennials, others are expressing deep concern about this young generation. Most notably they are fretting over what one study portrayed as millennials’ financial vulnerability, citing, among other factors, the generation’s propensity for “alternative” financial services such as payday loans, pawnshops, auto title loans, tax refund advances and rent-to-own products. But are millennials really so bad off?

“Financially fragile”

In the above-linked study, there are several indications that even educated, middle class millennials aged 23 to 35 exhibit some of the same financial behaviors normally attributed to the poor. For example, 42% had used alternative financial services such as payday loans, auto title loans, and rent-to-own retailers during the previous five years. Payday loans and pawn shops made up the largest group, with 34% having used them to obtain needed cash.

Alternative financing typically comes with higher fees and interest rates than traditional financial services, especially in states such as South Dakota where there is no cap on how much interest a payday lender or pawn shop is allowed to charge, and where the average interest rate on such loans is 574%. In many cases, the borrower is unable to pay the loan off, and takes out a subsequent, larger loan to pay off the first, setting them into a debt spiral from which they might never be able to emerge to the point where more traditional – and more tightly regulated – lending sources become available to them.

Roughly 67% of the respondents have at least one source of long-term debt such as a mortgage, car payment, and/or student loans. Over half of respondents with student loan debt are worried about their ability to pay off the loans, and nearly as many stated that they could not cover an emergency expense of even $2,000 if such a need arose in the next month. While it might be tempting to state that the recent economic crisis is the primary source of millennials’ financial difficulties, ignorance of good personal financial practices plays a large part, as well. And since only 17 states in the US currently require that students take classes in personal finances, the problem is unlikely to go away any time soon.

“Alternatives” aren’t always the worst choice

It isn’t that “alternative” financing such as payday loans are always the very worst choice; in some cases they may be a reasonable option for someone with a less than stellar credit rating and an urgent need for a small amount of cash that can be paid back within the allotted time frame. Here in particular, the need for improved financial literacy is essential, so that the use of alternative financial services doesn’t become a very expensive way of life.

It’s not all bad news for millennials

Much media speculation has been devoted to compartmentalizing the millennial generation, and unfortunately, a good deal of that speculation has been both oversimplified and fundamentally wrong. A typical attitude is that millennials are a cynical melding of an entitled baby boomer generation with a driven-to-succeed subsequent generation. Such oversimplification, shared by all these groups, has painted a picture of millennials as being both obsessed with making a good life for themselves and at the same time, doubtful as to their ability to achieve such a goal. Here are some common misconceptions as to the nature and aspirations of millennials going forward.

Not career-minded – While the potential for working in a single field, much less at one job, for one’s entire professional life, is slim compared to previous generations, millennials are very much focused upon careers. Where they differ from their parents and grandparents is their unwillingness to remain in a job or field that lacks the potential for upward mobility and/or personal challenge. They realize that they will likely be working until they reach age 75, rather than their parents, who typically retired at 65. As such, they choose to make those working years as satisfying and as lucrative as possible.

Have little buying power – Despite their lack of available credit, millennials have proven to be active consumers. They simply tend to spend available funds, rather than rely upon financing as heavily as their predecessors.

Lack savings goals – Millennials might be more inclined to purchase luxury items than were their parents, but two-thirds state that they are more inclined to save than to spend. This is borne out by their being more likely than their parents to avoid available credit offerings, even when such offerings are available.

More interested in working than enjoying life – Millennials are almost as inclined to save for a dream vacation (32%) as they are to invest (37%). They are less likely to remain in a position that requires extensive overtime and intrudes upon their ability to enjoy off-the-clock experiences.

Whether one takes a glass-half-empty or glass-half-full view, the one thing millennials do have on their side is youth, which means, in theory anyway, that they have plenty of time to fill their glass. And while there are and always will be many events beyond their control, they have a good chance of a comfortable retirement if they make smart financial choices while they’re young, and continue to do so through the years.