Parents are not the only ones worried about the financial situations of their children or grandchildren. Their children and grandchildren are pretty worried, too, according to a recent TD Ameritrade survey.
In first quarter wealth level studies conducted by Millionaire Corner, respondents’ concerns about their children’s or grandchildren’s financial situations increased in 2012 over last year, likewise financing the education of their grandchildren.
The TD Ameritrade survey finds that college looms large on the list of concerns for Generation Z, those roughly between the ages of 13 to 22. Thirty-nine percent said they are concerned about affording college and having student loans (as befitting this truly wired and tech-enhanced generation, 40 percent said they are worried about their identities being stolen).
When asked about their biggest concerns about the economy, nearly a quarter of Generation Z and their parents listed jobs and unemployment. Their concern is well-founded. The unemployment rate for teenagers in May was 24.6 percent.
While two-thirds of the Class of 2010 entered the real world with student loan debt, according to a November 2011 report by the Project on Student Debt, just one-quarter of Generation Z said they rely on or will need student loan assistance. Are they more optimistic than their elders or, to quote Professor Harold Hill in The Music Man, are closing their eyes to a situation they do not wish to acknowledge or are not aware of the caliber of disaster that may await them?
Millionaire Corner research finds that younger investors do tend to be more optimistic about the economy and their financial futures. In an April survey, eight-in-10 respondents under 40 said they believed the U.S. economy will improve after the election compared with seven-in-10 percent of older respondents. In another survey conducted last March, 62 percent of those under 40 said they were better off than they were four years ago, compared to about 40 percent of baby boomers and seniors.
To their credit, 78 percent of Generation Z say that saving money is important and 41 percent said they have established a budget. When asked what they would do with an extra $500, 55 percent said they would save it and 11 percent would earmark it for college.
Red flags emerge in their use of a credit card. Fifty-eight percent said that have carried a balance for six months or longer. Less than one-quarter (23 percent) said they pay off their balance monthly. Also troubling is that 23 percent of 18-22 year-olds and 41 percent of 16-18 year-olds said they do not have a checking or savings account.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.