This article is a contribution from guest blogger Stacy Becker. Please read her bio below.
According to psychologists who measure things like high rates of materialism, narcissism, the millennials have grown into adulthood with some serious personality problems which the baby boomers lacked. The entire nation is worrying about the present financial condition and the steps that the generations need to take in order to keep debts at bay. The analysts see a clash between the baby boomers and the young generation in accordance with the way they handle their finances and this is what is leading to a huge gap between the two aforementioned generations. While the current seniors are still in the process of learning how to handle their finances, the young generation is already suffering due to the wrong steps taken by them. The younger generation seems to be stressed over debt, thereby making savings a distant dream. The concerns of this article will deal with the different financial problems faced by the seniors and the young and the message that the seniors would love to pass on the young adults to save the economy from crushing.
Debt paralyzes the ability to save up for retirement – A constant worry for Gen Y
Studies reveal that debt inflicts financial pain on the millennials, thereby crippling down their ability to save for retirement. The young generation is always stressed with debt and has already put back their dream of saving money. According to recent reports, it has been seen that more than 65% of the millennials say that their biggest financial concern has been money and this has changed their attitude towards saving and spending money. 45% of them say that their debt is overwhelming and point to be noted, that this rate is twice that of the baby boomers, who were simultaneously surveyed.
Among all their debt obligations, paying off their student loan debt burden is one of the biggest concern of the millennials. Reports by Wells Fargo suggest that about 67% of the millenials financed their entire college through student loans, as compared to a 30% of baby boomers who financed through professional loans. About half of the millenials (50%) say that if they had won $10,000, the first thing they should do is to pay back their student loans.
The Gen Y wants to speak about their financial worries to the older generation
The researchers have found out that the young adults mostly turn to family for advice regarding their monetary situation. As they make the transition into adulthood, about 60% of the young say that it is their parents who have influenced them in the way they use money. A majority of about 80% of them have learnt how to manage their personal finances from their parents. In fact when the millennials were asked to make a list of the people from whom they comfortably seek financial advice, parents were the top ranked (60%). When the young have questions about investment and making money online, 38% of the millennials turn to their parents or other family members as their first choice.
Advice for the financial marketers – How to target spreading financial advice
The financial marketers often target programs in order to spread the word about sound financial knowledge. Instead of targeting fiscal education programs about savings and investments to the young generation, they can initially target the parents. It is interesting enough to note that about 59% of the young say that they would be interested in getting help of a financial advisor and 56% would prefer getting help of a seasoned advisor with experience. In short, they prefer taking advice from someone senior rather than someone who is closer in age.
Financial woes faced by the seniors – How they overcome the dire situations
It is a thing of past that the Americans entered retirement after paying off their mortgage loans and other liabilities and this was what was called the actual “Golden Years”. But gone are those good old days where the seniors could spend their retirement without any kind of debt. Nowadays, more and more people are struggling with mounting debt, fueled with credit cards and mortgages. Some of the most common worries faced by the seniors come in the form of credit card debt, mortgage debt, auto loan debt and there are some others who even owe debt on their student loans. Yes, such is the condition of the US. An increasingly large number of seniors are taking out reverse mortgages to make ends meet.
The nasty recession couldn’t mow down the self-confidence of the Gen Y
Although the nasty recession is taking a toll on the debt-stricken seniors, the millenials seem to be confident enough about their financial future. 68% of them believe that they will be successful in achieving a great standard of living and almost 3 in 4 millennials say that if they lose a job, they would be able to find out a new one. They seem to be pretty confident about their own abilities and this is certainly a positive sign for the US economy.
So, finance is something that is bridging the gap between two generations, the seniors and the young adults. Although the young adults seem to be well-off than the seniors, yet they should follow a disciplined life in order to retain their position and help the economy to flourish. If you fall in debt, you may get help of the debt reduction strategies so as to immediately bid goodbye to your liabilities.
AUTHOR BIO: -This article has been put forward by Stacy Becker, who is a financial writer and contributes her articles to different blogs and websites. Some topics covered by her are the pros and cons of using credit cards, some vital essential steps to take to avoid credit card debt and so on.
Image: Stuart Miles at FreeDigitalPhotos.net