Americans are downbeat about their short-term prospects, but they are even more pessimistic about the financial outlook for the next generation, according to a new study by Millionaire Corner.
In an expression of low-to-moderate optimism, one-third of 1,100 investors surveyed in September expect to be better off one year from now. The share of optimists shrinks significantly when investors are asked whether they believe the next generation will live better than the current generation. Only 21 percent of investors believe the next generation will enjoy a higher standard of living than they do.
“Hope fuels the U.S. economy, so it’s particularly distressing to see that the vast majority of Americans are lowering their financial outlook for their children and grandchildren,” said Catherine McBreen, president of Millionaire Corner. “Optimism may turn out to be the most serious casualty of the recession.”
Millionaires express the greatest degree of pessimism (18 percent), while investors with less than $100,000 in investable assets hold the highest hopes (31 percent) for the financial outlook of young Americans. Unfortunately, government data is providing scant grounds for this optimism.
Mom and Dad appear to be standing between an increasing number of young adults and poverty, according to the latest data available from the U.S. Census Bureau. More young adults ages 25 to 34 are living at home with their parents, and more than 45 percent of them have an income below the poverty threshold for a single person under the age of 65.
The number of doubled-up households – those containing at least one additional adult grew by 2 million to 21.8 million between the spring of 2007 and 2010, the Census Bureau reports. Shared households now account for 18.3 percent of U.S. households, an increase of 1.3 percent since 2007. Unemployment disproportionately affecting younger Americans is driving this trend.
“Every age group of workers under 55 years old was less likely to be employed in 2010 than they were in 2000, with the nation’s younger adults under 30 years of age faring the worst,” according to a study on teen employment for the Center for Labor Market Studies at Northeastern University.
Data from the 2010 Census put employment at 55 percent for Americans between 16 and 29, while the Bureau for Labor Statistic reports that nearly 3.4 million young adults were looking for jobs in 2010 for an average of more than 32 weeks. Among younger adults, age 20 to 24, there were more than 2.3 million job seekers. More than 2.7 million older adults, age 35 to 44, were looking for jobs. The median weekly earnings for workers between 16 and 24 were $174, and for adults 25 and older were $269.