Most Millennials, Gen Zs Not Able to Save in Today’s Economy

 

A new survey from the National Endowment for Financial Education (NAFE) reveals the truly dire nature of the financial situation of young people in America today.

When asked how well the statement “I am just getting by financially” describes their current situation, 71 percent of Gen Zs (18 to 29 year-olds) said that statement describes their financial situation at least “somewhat well” and one in four said that statement describes their situation completely or very well. 

The financial situation of Millennials (30 to 44 year-olds) is just as bad.  Almost one in three—31 percent—of Millennials said that just getting by describes their financial situation completely or very well and another 34 percent said “somewhat well.”

Among those 45 and over, a still very high 57 percent said “just getting by” describes their situation at least somewhat well. 

Saving requires the ability to put some money away at the end of the month.  Saving is particularly important for young people who should be accumulating assets to meet important life goals like getting married, buying a home, or helping children pay for a college education.

Most young Americans are having difficulty meeting their immediate expenses. 

The NAFE survey found that only 29 percent of Gen Zs and 36 percent of Millennials were able to save consistently; they always had some money left over at the end of the month.

By comparison, 38 percent of Gen Zs and 37 percent of Millennials never or rarely had any money left over at the end of the month.  

The inability of younger Gen Zs to save may be due to college costs.  Older Gen Zs and Millennials, however, are in their prime earning years and many do not have children to provide for.

Most young people that are not able to save now may never be able to.  A study of the lifetime earnings of five million Americans by the Federal Reserve Bank of New York found that for the median American, earnings stagnate between 35 and 55. 

The result is that large numbers of Americans have little hope for their financial future. 

The NEFE survey asked whether respondents agreed with the following statement “I feel like I will never have the things I want in life.”

Fifty-nine percent of Gen Zs and Millennials at least somewhat agreed that they would never have the things that they want in life. 

And when asked whether they ‘were concerned that the money they had or will save won’t last,” 72 percent of Gen Zs as well as 72 percent of Millennials were at least somewhat concerned their savings would run out.