THAI millennials' spend about 1.37 trillion baht (RM190 billion) a year on 'must-have items', representing 13 per cent of the country's GDP.
Research house TMB Analytics said half of the millennials were in debt with 20 per cent of them defaulting their loans.
Millennials, also known as Gen Y, are those born between 1981 and 1996. They number 14.4 million people in Thailand.
TMB Analytics head Naris Sathapholdeja said that according to the Bank of Thailand data, 7.2 million millennials have an average debt of 423,000 baht each (RM59,000).
"Noticeably, 20 per cent of Gen Y debtors or 1.4 million people failed to repay debts, accounting for 7.1 per cent of total NPLs."
The Bangkok Post quoted Naris saying that the average Gen Y consumer spent almost 100,000 baht (RM14,000) a year, or a quarter of their annual incomes, to buy "must-have" items that includes mobile phones, cosmetics, handbags, clothing, and watches and accessories.
According to a breakdown on spending for the must-have items, 22 per cent is for mobile phones, 11 per cent clothing, 8 per cent cosmetics, 5 per cent electronic devices, 4 per cent handbags, and 2 per cent for watches and accessories.
This makes up to an annual spending on must-have items to 1.37 trillion baht (RM190 billion). In comparison, it is 91 per cent of the five year investment budget of Thailand’s Eastern Economic Corridor project and eight times the cost of the high speed rail to link the three airports.
Naris said that high pay for millennials and nonchalant borrowing behaviour contributed to their lavish spending.
TMB’s findings come from a survey on social media about Gen Y's financial behaviour through the campaign#musthaveitemsbefore40.
He said 42 per cent of the respondents said they have bought must have items out of fear they will be behind trends.
Interestingly, 70 per cent of the respondents said they have borrowed money from financial institutions or cash advance cards to purchase such must-have items.
The findings also stated that more than 70 per cent of Gen Y use instalment payment services that charged interest.
The survey also underscored the Thai central bank's recent move to tighten ownership of credit cards and personal loans for those with incomes below 30,000 baht (RM4,150) a month.
According to the findings, about 48 per cent of Gen Y respondents dream of having their own homes, while 22 per cent want their own cars.
But they spend up to 69 per cent of their incomes on must-have items and only 12 per cent for homes, 10 per cent for cars and 9 per cent for savings and other assets.
Naris said the findings showed the need for these young consumers to be educated about savings.
Based on the median savings for the average Gen Y respondent of 5,500 baht (RM762) a month, it would take 90 years to save 6 million baht (RM831,000) to support their needs in retirement.