The Millennial generation faces a cloudy financial future. How can worried parents and grandparents help?
The Millennial generation - young Americans now in their teens and 20s - are facing a fading American Dream, according to worried parents and grandparents who rank the well being of the next generation among their greatest financial concerns.
In a show of optimism typical of youth, the millennial generation doesn’t think things are quite so bad despite the persistent high unemployment that has kept a disproportionate number of Millennials unemployed or underemployed.
Fewer than 18 percent of Americans age 60 and older believe the next generation will live better than the current generation, according to a survey of 1097 affluent investors conducted by Millionaire Corner in September. Survey participants under the age of 40 give younger Americans better odds. More than 40 percent believe the next generation will live better than they do.
Older Americans – those in the 50s and older – worry about the financial outlook for the Millennial generation almost as much as they do about their own retirement, according to a Millionaire Corner study of Mass Affluent investors completed in March. The Mass Affluent has a net worth of $100,000 to $1 million, not including primary residence, and are largely represented by baby boomers who have worked and saved their entire lives. Nearly 60 percent of the Mass Affluent rank the financial situation of the next generations as a top personal concern, while 67 percent worry about having enough money set aside for retirement and 73 percent worry about maintaining their own financial position.
More affluent Americans worry less about their own personal financial situations and rank worries about their children and grandchildren among their highest concerns. Investors with a net worth of $5 million to $25 million express more concern over the outlook for the Millennial generation than they do about maintaining their own current financial situation, having enough money set aside for retirement or being able to retire when they want to.
Recent studies by public policy institutes, such as the Pew Charitable Trusts and the Brookings Institution, have quantified a declining mobility among Americans. The think tanks have also confirmed federal data linking upward mobility with education and marriage.
The high net worth Millionaires surveyed by Millionaire Corner in March have all graduated from high school, 95 percent have graduated from college, and 30 percent have an advanced degree, such as an MBA or law degree. Among the affluent non-millionaire investors, 100 percent have graduated from high school, 66 have a college degree and 21 percent have an advanced degree.
Millionaire investors also have extremely high marriage rates: Among high net worth millionaires, 83 percent report being married and 7 percent, widowed. Parents and grandparents worried about the Millennial generation can stress the important role education and a lasting marriage play in building wealth.