By Warren S. Hersch
How to fund a college education and pay off student loans are the chief concerns of four in ten young people today, new research reveals.
TD Ameritrade Holding Corporation, (NYSE:AMTD), Omaha, Neb., published this finding in a summary of results from an online survey of 2,001 U.S residents. The respondents included 1,001 youths born between 1990 and 1999; and 1,000 of their parents.
The top concern of young people ages 13 to 22, which the study labels “Generation Z”, are affording college (39 percent) and having a large student loan balance (39 percent).
Nearly 6 in in 10 (58 percent) of Gen Z parents who were surveyed say they took out their own student loans
. And of these, 43 percent are still paying the loans back.
More than half (51 percent) of Gen Z parents who are still paying back college loans also have a 529 college savings plan to support their child's education. One in four of Gen Z youths and their parents, the survey says, share a concern about jobs and unemployment
Three in four (76 percent) of Gen Z youths say that saving money is important. And four in 10 (41 percent) say they have a budget and follow it closely.
When asked what they would do with an extra $500, 55 percent of Gen Z respondents say they would save the month; 11 percent say would save the money for college.
The survey observes, however, that Gen Z is “showing signs of developing early bad financial habits.”
Among Gen Z respondents who have a credit card, more than half (56 percent) have carried a balance for six months or longer (only 23 percent pay off the balance each month). Additionally, 23 percent of 19-to-22 year olds and 41 percent of 16-to-18 year olds claim they do not have either a checking or savings account.
Gen Z respondents who had experience with more financial products were found to be better budgeters. And on average those good budgeters had $850 more in savings than those who didn't budget as well ($950 vs. $100 saved).
Additionally, the survey found, good budgeters have “extensive discussions” with their parents about saving money (67 percent) compared to those who aren't good budgeters (34 percent).
Originally published on LifeHealthPro.com