What Gen X, Gen Y think about their financial situation
November 25, 2008
To better understand Gen X and Gen Y’s current and future financial situation, the American Savings Education Council and AARP commissioned a survey with members of these two generations. The online survey of 1,752 Americans ages 19-39 was conducted back in January 2008.
This research found that:
- Many young adults have yet to align their actions with their financial values and goals. While 91% report having financial goals for themselves, only 53% report sticking to a monthly budget. And while 62% have given at least some thought to their own retirement, 61% feel their retirement savings is behind schedule. 42% give themselves a grade of D or F to describe how well they are saving.
- There is a lack of financial sophistication among younger generations. Respondents were more likely to say they are very knowledgeable about their iPod (40%), than about how to file their taxes (26%), buy a home (21%), invest outside of the workplace (15%), or save for retirement (15%).
- Four out of five young adults report having some type of non-mortgage debt. This includes 63% with credit card debt, 48% with car loans, 31% with student loans, and 27% with medical debt.
- Workplace benefits are valued by employed young adults. At least three-quarters of employed young adults say it is important for their employer to provide health insurance, a retirement savings plan, matches or contributions to a retirement savings plan, a wellness plan, and education and/or advice on how to save for retirement.
- Many young adults feel things are harder for them than previous generations. Roughly half of those surveyed believe it is harder to support a family (54%), save for the long-term (52%), save for a child’s college education (50%), and buy a first home (47%) than it was for previous generations.
Key Question: If they think things were going to be hard for them back in January, how do you think they feel today, in the throes of a recession?
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Filed Under: Facts & Data, Gen-Y
November 25th, 2008 at 9:41 am
If that’s how they felt in January, I doubt they feel any better now.
However, there is a huge spread between 19 and 39 and their life situations: without digging into the full report, any summaries of Gen X and Y lumped together is pretty meaningless (and I’m saddened that’s how the study’s authors chose to publish the soundbites).
I’m most curious if it’s a function of the Generations or just the ages of the people in Gen X and Y right now. Does Gen X and Y know more about finances than Boomers (for example) when they were the same age as Gen X and Y now?
November 28th, 2008 at 9:44 am
Very good point Taylor.
December 2nd, 2008 at 7:40 am
Taylor/Jeffry, my thoughts exactly. I was surprised to see AARP allowed such a broad demographic in this study. With a spectrum bar of 20 years making up the respondents, it’s pretty easy to guess which end is concerned with retirement planning and which end is the expert on iPods.