Eight-in-ten of Millennials who receive regular parental financial support say they know others their age who are receiving similar help.
Millennials talk a good game about being confident in their financial knowledge and money habits, but do their actions speak louder than words? A new Bank of America/USA TODAY report suggests
The Better Money Habits Millennial report finds an upbeat mindset, positive actions and commendable financial goals. Eight-in-ten of the 1,000 Millennials surveyed believe they will be better off or the same as their parents, while two-thirds self-report good financial habits. For example, nearly half (49 percent) pay off their credit card debt in full every month and one-third (35 percent) report only carrying cash to limit their spending.
But three-fourths do worry about their financial situation. A majority (53 percent) are living paycheck to paycheck and many are concentrated on the present rather than the future. Nearly as many Millennials surveyed are saving for a house (32 percent) as are saving for a vacation (33 percent), while almost one-fourth (22 percent) have yet to start saving at all.
Millennials face several challenges to financial stability, not the least of which is a stagnant job market that has left half of college graduates either unemployed or underemployed in fields outside of their college major. The majority (57 percent) of Millennials surveyed say it is “really difficult” for people their age to live within their means and not overspend, while 36 percent cited “spending more than I should” as one of their top causes of stress.
Many Millennials are turning to their families for financial help. More than a third (35 percent) report receiving regular financial support from their parents or other family members, while 19 percent still live at home and are not paying rent or expenses. In addition, 15 percent receive regular help from their parents for their rent or mortgage, and one in four get help with their cell phone bills from family members.
Once considered to be an embarrassment, this turn of events is being regarded by Millennials (and perhaps grudgingly by their parents) as a new normal. Eight-in-ten of those who receive regular support say they know others their age who are receiving help from parents, and 55 percent of those who receive financial help say they discuss it openly and honestly with friends, the report states.
But hang in there, parents: Three-fourths of Millennials surveyed plan to stop taking parental financial assistance within the next four years.
The report also found:
- 37 percent of Millennials have less than $5,000 in savings.
- 22 percent have yet to start saving
- 18 percent of those who are both saving and employed have an IRA, while 43 percent have contributed to a 401(k).
- 33 percent have student loans.
- 83 percent of Millennial college graduates say they have good financial habits, compared to 56 percent of those without a degree.
- 73 percent of college graduates report being financially independent compared to 52 percent without.
- 32-percent say that $100,000 is the earning benchmark to feel successful.
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.