Preparing for Their Future:
A Look at the Financial State of Gen X
and Gen Y
Sponsored by
The American Savings Education Council and AARP (on behalf of
Divided We Fail)
Conducted by
Mathew Greenwald & Associates
Preparing for Their Future
A Look at the Financial State
of Gen X and Gen Y
March 2008
Copyright © 2008
American Savings Education Council and AARP
Reprinting with Permission
This report is jointly owned by the American Savings and Education Council (ASEC) and AARP. AARP engaged in this research
on behalf of Divided We Fail.
American Savings Education Council (ASEC)
1100 13th Street, NW, Suite 878
Washington, DC 20005
www.choosetosave.org
American Savings Education Council (ASEC), is a program of the Employee Benefit Research Institute (EBRI) Education and Research
Fund, a 501 (c) (3) non-profit organization (www.ebri.org and www.choosetosave.org). The ASEC mission: To make saving and
retirement planning a priority for all Americans. ASEC is a convener and connector that brings together public- and privatesector partners to share information on best practices and to collaborate on financial security initiatives. For more information visit
www.choosetosave.org/asec
AARP
601 E Street, NW
Washington, DC 20049
http://www.aarp.org
AARP is a nonprofit, nonpartisan membership organization that helps people 50+ have independence, choice and control in ways that are
beneficial and affordable to them and society as a whole. AARP does not endorse candidates for public office or make contributions to
either political campaigns or candidates. We produce AARP The Magazine, published bimonthly; AARP Bulletin, our monthly newspaper;
AARP Segunda Juventud, our bimonthly magazine in Spanish and English; NRTA Live & Learn, our quarterly newsletter for 50+
educators; and our website, http://www.aarp.org. AARP Foundation is an affiliated charity that provides security, protection, and
empowerment to older persons in need with support from thousands of volunteers, donors, and sponsors. We have staffed offices in all 50
states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands.
Mathew Greenwald & Associates of Washington, D.C. conducted the survey on behalf of the American Savings Education Council
(ASEC) and Divided We Fail. Subject matter expertise was provided by Divided We Fail and the Employee Benefits Research Institute. All
media inquiries about this report should be direct to EBRI’s John MacDonald at (202) 775-6349 or AARP’s Jim Dau or Alejandra Owens at
(202) 434-2560. All other inquiries should be directed to AARP’s Colette Thayer at (202) 434-6294.
1
Preparing for Their Future
A Look at the Financial State
of Gen X and Gen Y
Divided We Fail
Divided We Fail, launched nationally in January 2007, has worked to engage the American people, elected officials and the business
community to find broad-based, bi-partisan solutions to the most compelling domestic issues facing the nation: health care and the longterm financial security of Americans. AARP, Business Roundtable, Service Employees Union (SEIU), and National Federation of
Independent Business (NFIB) are engaging the American people, businesses, non-profit organizations, and elected officials in finding bipartisan solutions to ensure affordable, quality health care and long-term financial security – for all of us. More information about Divided
We Fail efforts can be found at www.dividedwefail.org.
AARP
AARP is a nonprofit, nonpartisan membership organization that helps people 50+ have independence, choice and control in ways that are
beneficial and affordable to them and society as a whole. AARP does not endorse candidates for public office or make contributions to
either political campaigns or candidates. We produce AARP The Magazine, published bimonthly; AARP Bulletin, our monthly newspaper;
AARP Segunda Juventud, our bimonthly magazine in Spanish and English; NRTA Live & Learn, our quarterly newsletter for 50+
educators; and our website, http://www.aarp.org. AARP Foundation is an affiliated charity that provides security, protection, and
empowerment to older persons in need with support from thousands of volunteers, donors, and sponsors. We have staffed offices in all 50
states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands.
Business Roundtable
Business Roundtable (www.businessroundtable.org) is an association of chief executive officers of leading U.S. companies with $4.5
trillion in annual revenues and more than 10 million employees. Member companies comprise nearly a third of the total value of the U.S.
stock markets and represent over 40 percent of all corporate income taxes paid. Collectively, they returned $112 billion in dividends to
shareholders and the economy in 2005. Roundtable companies give more than $7 billion a year in combined charitable contributions,
representing nearly 60 percent of total corporate giving. They are technology innovation leaders, with $90 billion in annual research and
development spending - nearly half of the total private R&D spending in the U.S.
SEIU
With 1.8 million members, SEIU (www.seiu.org) is the fastest-growing union in North America. Focused on uniting workers in three
sectors to improve their lives and the services they provide, SEIU is the largest health care union, including hospitals, nursing homes, and
home care; the largest property services union, including building cleaning and security; and the second largest public employee union.
NFIB
NFIB is the nation’s leading small-business advocacy association, with offices in Washington, D.C. and all 50 state capitals. Founded in
1943 as a nonprofit, nonpartisan organization, NFIB gives small- and independent-business owners a voice in shaping the public policy
issues that affect their business. NFIB’s powerful network of grassroots activists send their views directly to state and federal lawmakers
through our unique member-only ballot, thus playing a critical role in supporting America’s free enterprise system. NFIB’s mission is to
promote and protect the right of our members to own, operate and grow their businesses. More information about NFIB is available online
at www.NFIB.com.
2
Introduction & Methodology
• On behalf of the American Savings Education Council
(ASEC) and Divided We Fail, Mathew Greenwald &
Associates conducted an online survey with young
Americans ages 19 to 39 about their financial attitudes
and behaviors.
• In total, 1,752 respondents completed the online study.
On average, the survey took about 25 minutes to
complete.
• The data was weighted by age, gender, race and
education. Unweighted n sizes are reported throughout.
• Throughout the following report, Gen Y includes those
ages 19 to 27 and Gen X is comprised of those ages 28 to
39.
3
Profile of Younger People and
Households
4
Large majorities of young Americans describe
themselves as hard-working and family-oriented.
Nearly as many say they are optimistic.
How well do the following phrases describe you? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Very well
68%
68%
68%
Total
Hard-working
Gen Y
Gen X
Family-oriented
Optimistic
Not well
28%
27%
29%
4%
5%
3%
Total
59%
32%
9%
Gen Y
55%
62%
34%
31%
10%
7%
Gen X
Disciplined
Somewhat well
Total
35%
Gen Y
37%
51%
51%
14%
12%
Gen X
33%
51%
16%
Total
29%
27%
31%
55%
56%
55%
15%
17%
14%
Gen Y
Gen X
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
5
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Gen Yers characterize themselves as more
technologically savvy than do Gen Xers.
How well do the following phrases describe you? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Very well
Total
Technologically Gen Y
savvy Gen X
Charitable
Carefree
Expensive taste
Somewhat well
24%
29%
21%
Not well
48%
47%
27%
24%
30%
49%
Total
19%
53%
28%
Gen Y
Gen X
18%
20%
53%
52%
29%
28%
Total
17%
Gen Y
18%
Gen X
17%
Total
17%
19%
15%
Gen Y
Gen X
44%
39%
46%
42%
27%
27%
27%
36%
41%
56%
54%
58%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
6
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Half of young adults with a spouse or partner say
financial decisions are made in total partnership.
Which of the following best describes your role in how financial decisions are made in your
household? (Total n=991; Gen Y n=236; Gen X n=755) Among those who are married or living with a
partner
15%
18%
13%
You are the sole decision-maker
Gen Y
30%
28%
30%
You are the primary decisionmaker, but your spouse/
partner provides input
Gen X
51%
50%
52%
You and your spouse/partner make
decisions in total partnership
Your spouse/partner is the
primary decision-maker,
but you provide input
Total
4%
4%
4%
Your spouse/partner is <.5%
<.5%
the sole decision-maker
1%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
7
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Financial Independence
8
Interestingly, more Gen Yers consider themselves to
be “financially independent.”
Do you consider yourself to be “financially independent”? (Total n=1,752; Gen Y n=613; Gen X
n=1,139) Percent saying yes
57%
Total
62%
54%
Gen Y
Gen X
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
9
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Young Americans’ perception of being financially
independent increases with income.
Do you consider yourself to be “financially independent”? (Total n=1,752; <$30K n=474; $30K49K n=405; $50K-79K n=443; $80K+ n=352) Percent saying yes
66%
69%
$50K-$79K
$80K+
58%
57%
48%
Total
<$30K
$30K-$49K
Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are
either married or live with a partner.
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
10
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Despite their purported independence, Gen Yers are
nearly twice as likely to receive financial support from
family or friends.
In the past year, have you received any financial support from family or friends? (Total n=1,752;
Gen Y n=613; Gen X n=1,139) Percent saying yes
45%
33%
25%
Total
Gen Y
Gen X
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
11
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Receipt of financial support from family or friends is
relatively consistent among those in different racial
and ethnic groups.
In the past year, have you received any financial support from family or friends? (Total n=1,752;
Caucasian n=1,227; African-American n=150; Hispanic n=151; Asian/Pac. Islander n=154) Percent
saying yes
40%
33%
33%
Total
Caucasian
39%
28%
AfricanAmerican
Hispanic
Asian/Pac.
Islander
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
12
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Similarly, younger Gen Yers report receiving more
financial assistance from government programs than
Gen Xers.
In the past year, have you received any financial assistance from government programs? (Total
n=1,752; Gen Y n=613; Gen X n=1,139) Percent yes
18%
Total
23%
14%
Gen Y
Gen X
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
13
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Likelihood of receiving financial assistance from the
government is consistent across racial and ethnic
groups.
In the past year, have you received any financial assistance from government programs? (Total
n=1,752; Caucasian n=1,227; African-American n=150; Hispanic n=151; Asian/Pac. Islander n=154)
Percent saying yes
24%
18%
17%
Total
Caucasian
AfricanAmerican
14%
17%
Hispanic
Asian/Pac.
Islander
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
14
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Financial support from family is usually less than
$2,500 per year; those who receive government
assistance report somewhat higher amounts.
Over the past year, approximately how much
financial support did you receive from family
or friends? (Total n=545; Gen Y n=277; Gen X
n=268) Among those who have received
financial support from family or friends
Total
71%
15% 4%
6%
4%
Gen Y
71%
12%5%
3%
8%
Gen X
71%
<$2,500
$5,000 to <$10,000
Not sure
17%3%6%
3%
$2,500 to <$5,000
$10,000 or more
Over the past year, approximately how much
financial support did you receive from
government programs? (Total n=267; Gen Y
n=129; Gen X n=138) Among those who have
received financial assistance from government
programs
Total
Gen Y
Gen X
36%
31%
43%
<$2,500
$5,000 to <$10,000
Not sure
25%
11%11%17%
32%
11% 8%18%
16% 11% 14%16%
$2,500 to <$5,000
$10,000 or more
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
15
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Financial independence was achieved at
approximately 20 years old for members of these
younger generations.
At what age did you become financially independent? (Total n=1,024; Gen Y n=375; Gen X
n=649) Among financially independent individuals
Median Age At Start of “Financial Independence”
20
19
Total
Gen Y
21
Gen X
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
16
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
The most commonly cited milestone that marked their
financial independence was either graduation or
landing their first job.
What, if any, event or life stage would you say marked the start of your financial independence?
(Total n=1,024; Gen Y n=375; Gen X n=649) Among financially independent individuals
Top 4 Responses
24%
24%
24%
When you got your first job
High school graduation
Start of college
College graduation
Total
Gen Y
Gen X
23%
28%
19%
14%
16%
11%
10%
8%
12%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
17
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
For a few, their wedding date marked the start of their
financial independence.
What, if any, event or life stage would you say marked the start of your financial independence?
(Total n=1,024; Gen Y n=375; Gen X n=649) Among financially independent individuals
Top 5-8 Responses
Getting Married
(if not already)
Graduate school graduation
Start of graduate school
Something else
Total
Gen Y
Gen X
6%
4%
8%
2%
1%
4%
1%
1%
1%
19%
18%
21%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
18
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
College graduation marks the beginning of financial
independence for those with at least a bachelor’s
degree, with a similar trend among high school grads.
What, if any, event or life stage would you say marked the start of your financial independence?
(Total n=1,024; High school or less n=129; Some college n=373; Bachelor’s n=369; Master’s or more
n=153) Among financially independent individuals
Top 4 Responses
Total
High school or less
Some college
Bachelor's
Master's or more
42%
30%
24%23%23%
23%
16%
16%
14%
8% 6%
When you got
your first job
30%
25%
High school
graduation
5%
20%
12%13% 10%
Start of
college
1%
6%
College
graduation
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
19
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
In keeping, those with a master’s degree are more
likely to say their financial independence coincided
with the completion of graduate school.
What, if any, event or life stage would you say marked the start of your financial independence?
(Total n=1,024; High school or less n=129; Some college n=373; Bachelor’s n=369; Master’s or more
n=153) Among financially independent individuals
Top 5-8 Responses
Total
High school or less
Some college
Bachelor's
24%
10%
6% 5% 8% 5%
Getting married
2% 0% 0% 1%
Graduate school
graduation
Master's or more
24%22%
19%
13%
1% 0% 0% 2%
6%
Start of
graduate school
5%
Something else
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
20
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Current Financial Situations
21
Half of young adults are satisfied with their current
financial situation, yet only 9% are very satisfied.
How satisfied would you say you are with your current financial situation? (Total n=1,752; Gen
Y n=613; Gen X n=1,139)
Total
Gen Y
Net Satisfied:
53%
Gen X
Net Not Satisfied:
47%
44% 47% 42%
33% 35% 31%
14%
9% 9% 9%
Very satisfied
Somewhat satisfied
Not too satisfied
18%
9%
Not at all satisfied
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
22
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
African-Americans express less satisfaction with their
current financial situations than others.
How satisfied would you say you are with your current financial situation? (Total n=1,752;
Caucasian n=1,227; African-American n=150; Hispanic n=151; Asian/Pac. Islander n=154)
Total
Caucasian
African-American
Hispanic
Net Not Satisfied:
47%
Net Satisfied:
53%
44%46%
46%47%
29%
9% 9% 6%
48%
33% 33%
27%
23%
17%16% 16%
14%12%
15%
10%
Very satisfied
Asian/Pac. Islander
Somewhat satisfied
Not too satisfied
Not at all satisfied
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
23
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Predictably, satisfaction with one’s current financial
state improves as income increases. Still, few say
they are highly satisfied.
How satisfied would you say you are with your current financial situation? (Total n=1,752;
<$30K n=474; $30K-$49K n=405; $50K-$79K n=443; $80K+ n=352)
Total
<$30K
$30K-$49K
$50K-$79K
$80K+
Net Satisfied:
53%
Net Not Satisfied:
47%
58%
55%
44%
40%
35%
19%
9%
5%
40%
36%
33%
26%
17%
9% 10%
Very satisfied
Somewhat satisfied
Not too satisfied
20%
14%
14%
9%
5%
Not at all satisfied
Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are
either married or live with a partner.
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
24
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Few feel very financially secure, with Gen Xers
significantly more likely to say they feel “not at all
secure.”
Overall, how “financially secure” do you feel you are right now? (Total n=1,752; Gen Y n=613;
Gen X n=1,139)
Total
Gen Y
Gen X
Net Secure:
49%
42% 41% 43%
Net Not Secure:
51%
36%
40%
33%
15%
7% 7% 6%
Very secure
Somewhat secure
Not too secure
18%
12%
Not at all secure
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
25
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
As with satisfaction with their current circumstances,
young adults with higher incomes report higher
degrees of financial security.
Overall, how “financially secure” do you feel you are right now? (Total n=1,752; <$30K n=474;
$30K-49K n=405; $50K-$79K n=443; $80K+ n=352)
Total
<$30K
$30K-$49K
$50K-$79K
Net Secure:
49%
$80K+
Net Not Secure:
51%
58% 57%
49%
42%
43%
36%
26%
18%
7%
3% 5%
37%
23%
19%
7%
Very secure
Somewhat secure
Not too secure
21%
15% 16%
11%
7%
Not at all secure
Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are
either married or live with a partner.
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
26
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
The vast majority feel they should be better prepared
for a rainy day. At the same time, two-thirds say they
can count on family and friends if times get hard.
Thinking about your current financial situation, to what extent do you agree or disagree with
the following statement? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Strongly agree
You feel you should be more
prepared for a “rainy day”
50%
47%
52%
Total
Gen Y
Gen X
You can rely on friends and family
to help you financially when
you are in a tough situation
You worry about your financial
future, perhaps to the detriment
of enjoying today
Making decisions about money
makes you feel anxious
Total
Gen Y
Gen X
Total
Gen Y
Gen X
Total
Gen Y
Gen X
Total
You struggle to make ends meet
Gen Y
Gen X
Somewhat agree
Disagree
36%
36%
36%
29%
38%
23%
37%
33%
23%
40%
27%
25%
28%
37%
37%
36%
37%
37%
36%
42%
44%
41%
35%
34%
35%
23%
22%
23%
23%
16%
27%
38%
14%
17%
12%
39%
36%
42%
32%
41%
41%
41%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
27
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Young Americans indicate that they have financial
goals for themselves.
Thinking about your current financial situation, to what extent do you agree or disagree with
the following statement? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Strongly agree
You appreciate the material
goods you have, even if
it’s not a lot
You have financial goals
for yourself
56%
Total
Gen X
53%
Total
52%
Total
Gen Y
Gen X
35%
39%
20%
22%
19%
41%
41%
44%
38%
7%
9%
36%
48%
5%
4%
42%
57%
Gen Y
Disagree
39%
59%
Gen Y
Gen X
You are proud of how you
have lived your life
financially so far
Somewhat agree
7%
11%
39%
34%
43%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
28
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Relatively few say they feel taken advantage of by
the system, Gen Yers slightly more so than Gen
Xers.
Thinking about your current financial situation, to what extent do you agree or disagree with
the following statement? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Total
You sometimes offer financial
advice to others
Gen Y
Gen X
You feel taken advantage
of by “the system”
15%
Gen Y
14%
Gen X
15%
35%
45%
20%
Total
40%
42%
18%
17%
Disagree
Somewhat agree
Strongly agree
39%
31%
37%
27%
44%
54%
49%
58%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
29
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Two in ten include affording basic needs and the ability
to pay bills in their definition of financial security, with
enough leftover to save for a rainy day.
How would you define “financial security”? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Multiple
responses accepted
Top 6 Reported
22%
20%
23%
Not living paycheck to paycheck /
Able to afford basic needs
19%
18%
20%
Able to save / Have
emergency or rainy day fund
16%
17%
16%
Live comfortably
15%
16%
14%
Not having to worry about finances
13%
15%
12%
Able to deal with the
unexpected or hard times
Not having debt
Total
Gen Y
Gen X
8%
7%
9%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
30
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Only one in twenty associate financial security with
being able to travel and engage in other leisure
activities.
How would you define “financial security”? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Multiple
responses accepted
Top 7-12 Reported
Able to provide for family /
Money for children’s education
6%
5%
7%
Have money/enough money /
dollar amount (general)
5%
7%
3%
Can afford travel/entertainment/
leisure/fun
Able to retire / Maintain
current lifestyle in retirement
Don’t know / Refused
Total
Gen Y
Gen X
5%
5%
5%
5%
3%
6%
7%
8%
6%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
31
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Savings and Debt
32
Since six in ten say they struggle to make ends meet,
it is not surprising that being able to pay bills tops the
list of financial concerns.
When it comes to your finances, what is your biggest fear or concern? (Total n=1,752; Gen Y
n=613; Gen X n=1,139) Multiple responses accepted
Top 5 Reported
20%
22%
19%
Paying bills / Making ends meet
13%
14%
12%
Unemployment / Job loss / Career
Gen Y
Gen X
12%
12%
13%
Lack of savings / Having enough
for an emergency / Future
11%
12%
10%
Having enough money
to support self/family
Being able to retire /
Afford retirement
Total
11%
5%
15%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
33
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Half of young adults say they stick to a monthly
budget. Far fewer have a written financial plan or a
will.
Do you currently…? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Percent saying yes
Total
Gen Y
Gen X
53%
55%
51%
Stick to a monthly budget
Have a formal, written financial plan
14%
12%
16%
Have a living will (also known
as a health care directive)
14%
11%
16%
Have a will
14%
9%
17%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
34
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Married young adults and those living with a partner
are more likely to have a financial plan, a will, and a
living will.
Do you currently…? (Total n=1,752; Married/Living w/ partner n=991; Unmarried/No partner n=761)
Percent saying yes
53%
52%
53%
Stick to a monthly budget
Have a formal, written financial plan
14%
17%
12%
Have a living will (also known
as a health care directive)
14%
16%
12%
Have a will
14%
16%
11%
Total
Married/Living w/ Partner
Unmarried/No partner
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
35
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Just half of members of these younger generations
report that they save on a regular basis.
Do you currently save money on a regular basis? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Total
50%
52%
Yes
48%
Gen Y
Gen X
50%
48%
52%
No
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
36
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Not surprisingly, likelihood of saving regularly
increases with income.
Do you currently save money on a regular basis? (Total n=1,752; <$30K n=474; $30K$49K n=405; $50K-$79K n=443; $80K+ n=352)
Total
<$30K
$30K-$49K
$50K-$79K
$80K+
70%
52%
50%
57% 57%
50%
48%
43% 43%
30%
Yes
No
Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are
either married or live with a partner.
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
37
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Fewer have savings designated as an emergency
fund for unanticipated expenses.
Do you have an “emergency savings” fund or money that you keep in reserve for unexpected
expenses, like a big car repair, or in case you were to stop receiving income for any reason? (Total
n=1,752; Gen Y n=613; Gen X n=1,139)
Total
Gen Y
Gen X
62%
38%
37%
Yes
63%
61%
39%
No
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
38
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
A sizable proportion of employed young Americans
say they could not live off their savings for more than
one month.
If you were to stop receiving income today from work or other sources, how long would you be
able to live on your savings alone? (Total n=1,598; Gen Y n=534; Gen X n=1,064) Among
employed individuals
40%
38%
42%
Less than one month
29%
32%
28%
1 to less than 3 months
3 to less than 6 months
6 months to less than 1 year
1 year or longer
Not sure
Total
Gen Y
Gen X
11%
13%
11%
9%
7%
10%
7%
5%
8%
4%
5%
3%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
39
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Eight out of ten young people do not feel they are
saving enough money for the future.
Given your current income and living situation, do you feel you are savings enough money for
the future? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Total
Gen Y
Gen X
83%
17%
20%
Yes
80%
84%
16%
No
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
40
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Those with an income of $80,000 or more are four
times more likely than those who earn less than
$30,000 to feel they are saving enough money.
Given your current income and living situation, do you feel you are savings enough money for
the future? (Total n=1,752; <$30K n=474; $30K-$49K n=405; $50K-$79K n=443; $80K+ n=352)
Total
<$30K
$30K-$49K
$50K-$79K
91%
83%
$80K+
86%
79%
63%
37%
21%
17%
9%
14%
Yes
No
Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are
either married or live with a partner.
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
41
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Large shares report that they have credit card and car
loan debt. Gen Xers are more apt than Gen Yers to
have most kinds of debt.
Do you have any of the following types of debt? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Percent saying yes
63%
57%
67%
48%
42%
52%
35%
Credit card
Car loan
Mortgage
Student loan
Medical
Home equity loan
Other
17%
Total
Gen Y
Gen X
49%
31%
32%
30%
27%
25%
28%
11%
4%
16%
22%
20%
23%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
42
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Three in ten young adults are $20,000 or more in
debt, excluding mortgages.
Approximately, how much non-mortgage debt do you currently have? (Total n=1,496; Gen Y
n=503; Gen X n=993) Among those who have non-mortgage debt
Less than $1,000
$1,000 to $2,499
$2,500 to $4,999
$5,000 to $9,999
$10,000 to $19,999
$20,000 to $49,999
$50,000 or more
12%
17%
9%
7%
9%
7%
11%
14%
9%
18%
19%
17%
21%
21%
22%
20%
15%
23%
10%
6%
13%
Total
Gen Y
Gen X
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
43
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Debt levels seem especially high when considering
that the majority of these young people have less
than $10,000 in total savings and investments.
In total, about how much money would you say you (and your spouse or partner) currently have
in savings and investments, not including the value of your primary residence? (Total n=1,752;
Gen Y n=613; Gen X n=1,139)
57%
66%
50%
Less than $10,000
$10,000 to $19,999
$20,000 to $29,999
$30,000 to $49,999
$50,000 to $99,999
$100,000 or more
10%
13%
8%
6%
3%
8%
Total
Gen Y
Gen X
6%
3%
7%
7%
4%
9%
6%
2%
9%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
44
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Still, just one-third of young adults identify their
debt as a major problem.
Thinking about your current financial situation, how would you describe your level of debt?
(Total n=1,587; Gen Y n=520; Gen X n=1,067) Among those who have debt
Total
Gen Y
Gen X
47% 50% 45%
35%
38%
30%
17% 19% 15%
Major problem
Minor problem
Not a problem
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
45
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Those with mortgage debt only are far less likely to
see their debt as a problem.
Thinking about your current financial situation, how would you describe your level of debt?
(Total n=1,587; Non-mortgage debt n=1,513; Mortgage debt only n=72) Among those who have debt
Total
Non-mortgage debt
Mortgage debt only
76%
47% 48%
35% 36%
21%
17%
14%
3%
Major problem
Minor problem
Not a problem
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
46
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
It follows, then, that most report being behind schedule
regarding saving.
For the following, do you think you are behind schedule, ahead of schedule, or on track
compared to others your age? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Behind schedule
Saving for an emergency
or having savings
in general
On track
67%
Total
Gen Y
Gen X
37%
52%
6%
8%
28%
65%
46%
7%
27%
55%
Gen Y
6%
23%
61%
Gen X
Debt
27%
69%
Total
Total
25%
63%
Gen Y
Gen X
Saving for retirement
Ahead of schedule
10%
26%
36%
39%
7%
15%
19%
34%
12%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
47
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
By comparison, roughly half feel they are “on
track” when it comes to their family lives, careers
and their housing situations.
For the following, do you think you are behind schedule, ahead of schedule, or on track
compared to others your age? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Behind schedule
Career
7%
6%
7%
Total
41%
46%
8%
Gen Y
40%
43%
47%
46%
9%
6%
Total
39%
45%
13%
Gen Y
38%
46%
11%
Gen X
39%
45%
Total
Family life
46%
40%
49%
Gen X
Gen Y
Gen X
Housing
Ahead of schedule
42%
49%
38%
Total
Education
On track
Gen Y
Gen X
26%
24%
27%
55%
54%
56%
14%
14%
15%
14%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
48
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Financial Goals
49
Career advancement and retirement savings are
priorities for most. Gen X is more focused on
retirement savings. Gen Yers focus more on career.
Thinking about the next ten years, which of the following are goals or priorities for you? (Total
n=1,752; Gen Y n=613; Gen X n=1,139) Multiple responses accepted
Top 5 Reported
Advancing your career or
earning more money
Putting money away for retirement
76%
84%
71%
75%
69%
80%
Minimizing stress in your life
74%
77%
72%
Paying off debt
73%
69%
76%
Buying a home or making major
improvements to your home
67%
70%
64%
Total
Gen Y
Gen X
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
50
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Paying bills on time and focusing on health are
also priorities.
Thinking about the next ten years, which of the following are goals or priorities for you? (Total
n=1,752; Gen Y n=613; Gen X n=1,139) Multiple responses accepted
Top 6-10 Reported
64%
68%
62%
Paying basic bills in full
and on time
64%
67%
61%
Focusing on your health
Doing more leisure travel
Purchasing a car
Preparing for a child’s education
Total
Gen Y
Gen X
57%
55%
58%
50%
56%
45%
46%
41%
50%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
51
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Over four in ten hope to obtain a higher degree,
and a similar share would like to be more spiritual.
Thinking about the next ten years, which of the following are goals or priorities for you? (Total
n=1,752; Gen Y n=613; Gen X n=1,139) Multiple responses accepted
Top 11-15 Reported
45%
Receiving a higher education
or degree for yourself
59%
35%
44%
Having children or
having more children
63%
30%
43%
44%
42%
Living a more spiritual life
37%
Getting married
(if not currently)
Starting a business /
Grow an existing business
Total
Gen Y
Gen X
54%
24%
<.5%
<.5%
1%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
52
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Career advancement and earning more is most
important. Reducing debt closely follows as the most
important goal of young adults.
Thinking about the next ten years, which of the following would you say is the most important
goal or priority for you? (Total n=1,741; Gen Y n=609; Gen X n=1,132) Among those who mention
goals or priorities
Top 5 Reported
22%
20%
16%
Advancing your career or
earning more money
Paying off debt
16%
12%
18%
Living a more spiritual life
10%
7%
13%
Receiving a higher education
or degree for yourself
7%
13%
3%
Buying a home or making major
improvements to your home
Total
Gen Y
Gen X
7%
7%
7%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
53
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Saving for retirement drops significantly lower on
the list when asked which goal is most important.
Thinking about the next ten years, which of the following would you say is the most important
goal or priority for you? (Total n=1,741; Gen Y n=609; Gen X n=1,132) Among those who mention
goals or priorities
Top 6-10 Reported
Getting married
(if not currently)
Paying basic bills in full
and on time
6%
9%
4%
6%
6%
6%
Putting money away for retirement
6%
3%
8%
Focusing on your health
5%
3%
7%
Preparing for a child’s education
5%
2%
8%
Total
Gen Y
Gen X
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
54
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Although three-quarters of young adults identify
minimizing stress as a goal, it falls low on the list of
most important priorities.
Thinking about the next ten years, which of the following would you say is the most important
goal or priority for you? (Total n=1,741; Gen Y n=609; Gen X n=1,132) Among those who mention
goals or priorities
Top 11-15 Reported
Having children or
having more children
3%
3%
3%
Minimizing stress in your life
3%
2%
3%
Purchasing a car
2%
2%
3%
Doing more leisure travel
Start a business /
Grow an existing business
Total
Gen Y
Gen X
1%
1%
1%
<.5%
<.5%
<.5%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
55
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Younger Americans express confidence that they will
achieve their most important goals in the near future.
How confident are you that you will be able to meet your most important goals in the next ten
years? (Total n=1,741; Gen Y n=609; Gen X n=1,132) Among those who have goals or priorities for
the next ten years
Total
Gen Y
Gen X
53% 53% 53%
39% 41% 37%
7% 5% 9%
Very confident
Somewhat
confident
Not too confident
1% 1% 1%
Not at all confident
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
56
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Generational Differences
57
Young adults most often cite increased cost of living
and retirement issues as the biggest financial
difference between the generations.
What do you think is the most significant financial difference between your generation and your
parents’ generation? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Top 6 Reported
19%
21%
18%
Cost of living / Inflation
18%
15%
19%
Retirement/ No pensions/
No Social Security/ Medicare
Spend more now / Don’t save
Debt / Credit cards
Parents were smarter financially/
Saved sooner/ Disciplined spenders
Work environment/ Work harder
now/ Change jobs more often
Total
Gen Y
Gen X
11%
11%
11%
9%
8%
9%
9%
9%
10%
5%
3%
6%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
58
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Others think young people spend more and save less
than their parents did, even though a few feel their
incomes are higher and they have more choices.
What do you think is the most significant financial difference between your generation and your
parents’ generation? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Multiple responses accepted
Top 7-11 Reported
More investment options now
4%
3%
4%
We make more money
3%
3%
3%
Economy/ Recession
3%
3%
2%
Government policy/spending/ Taxes
3%
3%
2%
No rise in salary
3%
1%
3%
Total
Gen Y
Gen X
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
59
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Buying a home and finding work are seen as more
difficult for many of today’s younger Americans,
although obtaining an education is deemed easier.
To the best of your knowledge, do you think it is easier or harder for people in your generation
to do the following than it was for your parents’ generation? (Total n=1,752; Gen Y n=613; Gen X
n=1,139)
Easier for your generation
54%
Total
Getting an education
Buying a first home
Gen Y
Gen X
Total
Finding good
employment
Gen Y
Gen X
28%
25%
30%
24%
21%
26%
25%
27%
24%
32%
28%
21%
22%
22%
52%
Gen X
Harder for your generation
24%
57%
Gen Y
Total
Same
34%
30%
22%
47%
48%
46%
44%
37%
49%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
60
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Moreover, supporting a family is considered a
harder task, and many young adults view saving
money for the long term as harder now.
To the best of your knowledge, do you think it is easier or harder for people in your generation
to do the following than it was for your parents’ generation? (Total n=1,752; Gen Y n=613; Gen X
n=1,139)
Easier for your generation
Total
Saving for a child’s
college education
Saving money for the
long term
Gen Y
20%
Total
20%
Gen Y
Total
Gen Y
27%
28%
Gen X
Gen X
Supporting a family
23%
14%
24%
29%
50%
42%
56%
51%
35%
25%
31%
18%
Gen X 11%
Harder for your generation
30%
23%
17%
Same
36%
28%
43%
57%
54%
46%
61%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
61
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Eight in ten anticipate having the same amount of
money or more when they reach their parents’ age.
Gen Xers are more likely to say they will have less.
Do you expect that by the time you are your parents’ age you will have accumulated more
money than your parents, less money, or about the same amount of money as your parents?
(Total n=1,752; Gen Y n=613; Gen X n=1,139)
Total
Gen Y
Gen X
54% 54% 53%
34%
27%
23%
24%
19%
12%
More money
About the same
Less money
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
62
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Young people with higher incomes are more apt to
feel they will eventually accumulate more money
than their parents.
Do you expect that by the time you are your parents’ age you will have accumulated more
money than your parents, less money, or about the same amount of money as your parents?
(Total n=1,752; <$30K n=474; $30K-$49K n=405; $50K-$79K n=443; $80K+ n=352)
Total
61%
<$30K
$30K-$49K
$50K-$79K
$80K+
65%
54%
49%47%
27%
More money
32%30%
23%21%
About the same
19%19%
23%
16%14%
Less money
Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are
either married or live with a partner.
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
63
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
African-Americans and Hispanics are especially likely
to foresee having more money than their parents.
Do you expect that by the time you are your parents’ age you will have accumulated more
money than your parents, less money, or about the same amount of money as your parents?
(Total n=1,752; Caucasian n=1,227; African-American n=150; Hispanic n=151; Asian/Pac. Islander
n=154)
Total
Caucasian
African-American
Hispanic
Asian/Pac. Islander
68% 66%
54%
47%
52%
27%
32%
22%
25%
16%
More money
About the same
19%21%
23%
16%13%
Less money
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
64
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Most of these young Americans report that they
come from middle or lower-middle class
upbringings.
When you were growing up, how would you describe your family’s lifestyle? (Total n=1,752; Gen
Y n=613; Gen X n=1,139)
Total
Upper class
Upper middle class
Gen Y
Gen X
1%
1%
1%
11%
11%
11%
49%
54%
45%
Middle class
31%
28%
32%
Lower middle class
Lower class
8%
7%
10%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
65
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Many still consider themselves part of the middle
class.
Thinking about your current lifestyle, do you consider it to be…? (Total n=1,752; Gen Y n=613;
Gen X n=1,139)
Total
Upper class
Upper middle class
Gen Y
Gen X
1%
1%
1%
9%
8%
10%
52%
52%
51%
Middle class
30%
31%
29%
Lower middle class
Lower class
9%
8%
9%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
66
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Still nearly one-quarter indicate that they have
experienced some upward mobility.
Class change (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Total
Gen Y
Gen X
23%
Class improved
21%
25%
54%
Class remained the same
52%
55%
23%
Class declined
27%
20%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
67
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Views toward the Workplace and
Benefits
68
Similar shares (about half) believe that employers
have employees’ best interest at heart and that
people their age feel loyal to their employers.
To what extent to you agree or disagree with the following statements? (Total n=1,752; Gen Y
n=613; Gen X n=1,139)
Strongly agree
People your age feel loyal
to their employers
Employers generally have
their employees’ best
interest at heart
Somewhat agree
Disagree
Total
7%
39%
53%
Gen Y
8%
35%
57%
Gen X
7%
43%
Total
6%
42%
Gen Y
9%
Gen X
4%
45%
39%
51%
52%
46%
57%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
69
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Health insurance is clearly viewed as a critical benefit
for employers to offer, while wellness programs are
seen as less essential.
How important is it that your employer…? (Total n=1,598; Gen Y n=534; Gen X n=1,064) Among
employed individuals
Very important
Total
Provides health insurance
Gen Y
Total
39%
Gen Y
41%
Gen X
39%
Not important
80%
14% 6%
77%
17% 6%
82%
Gen X
Offers a wellness program
Somewhat important
13% 6%
39%
38%
39%
22%
22%
22%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
70
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Retirement plans and company matches are also
seen as very important benefits, with Gen Xers even
more likely to stress their importance.
How important is it that your employer…? (Total n=1,598; Gen Y n=534; Gen X n=1,064) Among
employed individuals
Very important
Matches or contributes money
to a retirement savings plan in
addition to what you save
Somewhat important
59%
Total
Gen Y
Gen Y
35%
Gen X
35%
62%
37%
38%
15%
31%
51%
Total
11%
29%
57%
Gen X
Offers education and/or advice
on how to save for retirement
33%
63%
Total
Gen Y
30%
52%
Gen X
Provides a retirement savings
plan
Not important
28%
40%
41%
39%
8%
12%
15%
10%
23%
24%
23%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
71
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
When asked which benefit is most critical, health
insurance is by far seen as the most important
benefit; retirement plans are second.
Which of these is most important? (Total n=1,598; Gen Y n=534; Gen X n=1,064) Among employed
individuals
64%
68%
61%
Provides health insurance
Matches or contributes money
to a retirement savings plan
in addition to what you save
21%
19%
22%
12%
10%
13%
Provides a retirement savings plan
Offers education and/or advice
on how to save for retirement
Offers a wellness program
Total
Gen Y
Gen X
2%
3%
2%
1%
1%
1%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
72
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
African-Americans and Asian/Pacific Islanders place
slightly less emphasis on health insurance as a
workplace benefit.
Which of these is most important? (Total n=1,598; Caucasian n=1,166; African-American n=123;
Hispanic n=126; Asian/Pac. Islander n=118) Among employed individuals
Total
67%
64%
Caucasian
African-American
Hispanic
Asian/Pac. Islander
63%
53%
48%
34%
21%
17%
30%
22%
17%
12%12%11%11%
2% 2%
*
Provides
health
insurance
Matches or
Provides a
contributes money retirement
to a retirement
savings
savings plan
plan
3% 4% 1% 2% 1%
Offers education
and/or advice
on how to save
for retirement
*
1%
Offers a
wellness
program
* Less than 0.5%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
73
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Individuals who earn at least $80,000 are more
inclined than those who earn less to prefer that their
employer provides a retirement savings plan.
Which of these is most important? (Total n=1,598; <$30K n=392; $30K-$49K n=376; $50K-$79K
n=421; $80K+ n=343) Among employed individuals
Total
<$30K
$30K-$49K
$50K-$79K
$80K+
64%65% 65%65%
54%
25%
21% 22%
20%
19%
12%
Provides
health
insurance
19%
8% 12%12%
Provides a
Matches or
contributes money retirement
savings
to a retirement
plan
savings plan
2% 3% 3% 2% 2% 1% 2% 1% 1%
Offers education
and/or advice
on how to save
for retirement
Offers a *
wellness
program
Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are
either married or live with a partner.
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
74
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
More than half of young adults receive health
insurance through their or their spouse’s employer.
Still, one-quarter indicate that they are not insured.
Are you currently covered by health insurance? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Total
Gen Y
Gen X
51%
44%
35%
11%
Yes, through
your employer
15%
5%
Yes, through
spouse's
employer
28%
20%
14%
30%
24%
19%
1% 1% 1%
Yes, from some
other source
No
Not sure
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
75
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Likelihood of being insured by an employer increases
with income.
Are you currently covered by health insurance? (Total n=1,752; <$30K n=474; $30K-$49K n=405;
$50K-$79K n=443; $80K+ n=352)
Total
<$30K
$30K-$49K
$50K-$79K
$80K+
61%
58% 59%
44%
44%
33%
21%
Yes, through
your employer
28%
24%
20%
18%
18%
15%
11%
9% 7%
9% 6%
8%
1%
Yes, through
spouse's
employer
Yes, from some
other source
No
1%1% 3%
*
*
Not sure
* Less than 0.5%
Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are
either married or live with a partner.
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
76
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
African-American and Hispanic young adults are less
likely to have health insurance coverage than others.
Are you currently covered by health insurance? (Total n=1,752; Caucasian n=1,227; AfricanAmerican n=150; Hispanic n=151; Asian/Pac. Islander n=154)
Total
44%
47%
Caucasian
African-American
Hispanic
Asian/Pac. Islander
41% 42%
33%
11%13% 7%
6%
Yes, through your
employer
15%
Yes, through
spouse's employer
27%
20% 19% 21% 22%
Yes, from some
other source
30% 31%
24%
21%
19%
No
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
77
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Nearly one-quarter of those employed say they are
covered by a traditional pension plan. Half report that
no such plan is available.
Are you currently covered by a traditional pension plan, also known as a defined benefit plan?
(Total n=1,598; Gen Y n=534; Gen X n=1,064) Among employed individuals
Total
Gen Y
Gen X
53% 53% 53%
28%
23%
16%
Yes, currently
covered
13%
10% 12% 9%
No, such a plan is
available, but you
are not covered
No, no such plan is
available
19%
10%
Not sure
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
78
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Far more young adults are eligible for a defined
contribution plan than a defined benefit plan.
Are you eligible for your employer’s defined contribution retirement savings plan, such as a
401(k) or 403(b)? (Total n=1,598; Gen Y n=534; Gen X n=1,064) Among employed individuals
Total
Gen Y
Gen X
57%
50%
39%
31% 32% 31%
9%
Yes, currently
covered
12%
17%
10%
7%
No, such a plan is
available, but you
are not covered
No, no such plan is
available
6%
Not sure
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
79
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Although the majority do, roughly one-quarter of
young adults do not contribute money to their
defined contribution retirement savings plan.
Do you personally contribute money to your employer-sponsored 401(k) or 403(b) retirement
savings plan? (Total n=866; Gen Y n=213; Gen X n=653) Among employed individuals who are eligible
for a DC retirement savings plan
Total
Gen Y
Gen X
76%
71%
62%
37%
27%
22%
2%
Yes
No
1%
2%
Not sure
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
80
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Propensity to contribute money to an employersponsored retirement savings plan increases with
income.
Do you personally contribute money to your employer-sponsored 401(k) or 403(b) retirement
savings plan? (Total n=866; <$30K n=100; $30K-$49K n=227; $50K-$79K n=259; $80K+ n=256)
Among employed individuals who are eligible for a DC retirement savings plan
Total
<$30K
$30K-$49K
$50K-$79K
$80K+
89%
71%
69%
63%
60%
39%36%
27%
27%
11%
2% 1% 1% 4%
*
Yes
No
Not sure
Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are
either married or live with a partner.
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
81
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
The vast majority of young adults show support for
voluntary automatic enrollment into retirement
plans; nearly half say it’s a very good idea.
Generally, do you feel it is a good idea or a bad idea for employers to voluntarily enroll workers
automatically in a retirement savings plan and set up automatic contributions from the
workers’ paychecks? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Total
45%
49%
40%
40%
Gen Y
Gen X
46%
35%
11% 10% 11%
Very good idea
Somewhat good
idea
Somewhat bad idea
4% 3% 5%
Very bad idea
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
82
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Full-time employees are especially likely to view
automatic enrollment favorably.
Generally, do you feel it is a good idea or a bad idea for employers to voluntarily enroll workers
automatically in a retirement savings plan and set up automatic contributions from the
workers’ paychecks? (Total n=1,752; Full-time n=1,163; Part-time n=435; Unemployed n=154)
Total
50%
45%
39%
31%
Full-time/35+ hrs/wk
Part-time/<35 hrs/wk
45% 46%
40% 37%
11% 9% 14%13%
Very good idea
Unemployed
Somewhat good
idea
Somewhat bad idea
4% 4% 2%
10%
Very bad idea
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
83
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Retirement Mindset
84
Six in ten young adults have given at least some
thought to their own retirement, although Gen Xers
have thought about it more.
In general, how much thought have you given to your own retirement? (Total n=1,752; Gen Y
n=613; Gen X n=1,139)
Total
42%
38%
Gen X
44%
29%
26%
20%
Gen Y
33%
25%
13%
A great deal of
thought
9%
Some thought
Not too much
thought
15%
5%
No thought at all
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
85
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Young people with higher incomes are more likely
to have thought about their own retirement.
In general, how much thought have you given to your own retirement? (Total n=1,752; <$30K
n=474; $30K-$49K n=405; $50K-$79K n=443; $80K+ n=352)
Total
39%
<$30K
$30K-$49K
49%
42% 44% 45%
36%
23%
20%
12%
20%
A great deal of
thought
$50K-$79K
35%
29% 29%
26%
14%
Some thought
$80K+
Not too much
thought
17%
9%
8%
3% 2%
No thought at all
Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are
either married or live with a partner.
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
86
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Most young adults expect to live to be (at least)
octogenarians.
Based on what you know about your health, your family history, and other factors, until what age
do you expect to live? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Total
Gen Y
Gen X
44%
44%
44%
8%8%8%
70 to 79
Gen
X
Mean
81
81
82
Median
80
81
80
20%
20%
20%
21%20%23%
Younger
than 70
Total
Gen
Y
80 to 89
90 to 99
6%7% 5%
1%1%1%
100 or older
Not sure
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
87
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Most expect to retire between age 60 and 69. Gen
Xers are more apt than Gen Yers to say ages
70 to 79.
At what age do you think you will retire? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Total
Gen Y
58%60%56%
Total
Gen
Y
Gen
X
Mean
63
61
64
Median
65
65
65
18% 21%
13%
17%18%16%
5% 7% 4%
Younger than
50
Gen X
3% 1% 3%
50 to 59
60 to 69
70 to 79
80 or older
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
88
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Members of both the younger and older generations
expect to retire at roughly the same age.
At what age do you think you will retire? (This study’s Total n=1,752; RCS Total n=615)
This study's respondents
RCS respondents ages 40+
58% 59%
17%
5% 3%
Younger than
50
18%
11%
14%
3% 2%
50 to 59
60 to 69
70 to 79
80 or older
Source: 2007 Retirement Confidence Survey (RCS) (Base: non-retirees ages 40+; n=615)
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
89
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Many say that they have not saved for retirement,
outside of Social Security and employer-provided
monies.
Not including Social Security taxes or employer-provided money, have you and/or your spouse
personally saved any money for retirement? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Total
Gen Y
Gen X
67%
58%
52%
45%
38%
27%
4%
Yes
No
5%
3%
Not sure
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
90
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Likelihood of personally saving for retirement falls
precipitously as income decreases.
Not including Social Security taxes or employer-provided money, have you and/or your spouse
personally saved any money for retirement? (Total n=1,752; <$30K n=474; $30K-$49K n=405;
$50K-$79K n=443; $80K+ n=352)
Total
<$30K
$30K-$49K
77%
$80K+
77%
58%
38%
$50K-$79K
61%
50%
46%
39%
21%
17%
4% 6%
Yes
No
1%
4% 2%
Not sure
Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are
either married or live with a partner.
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
91
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
African-American young adults lower rates of personal
retirement savings.
Not including Social Security taxes or employer-provided money, have you and/or your spouse
personally saved any money for retirement? (Total n=1,752; Caucasian n=1,227; African-American
n=150; Hispanic n=151; Asian/Pac. Islander n=154)
Total
Caucasian
African-American
69%
58% 55%
43%
38%
Hispanic
Asian/Pac. Islander
64%
53%
39%
28%27%
4% 2% 4%
Yes
No
9% 8%
Not sure
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
92
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Overall, these young adults are far less likely than
those who are older to say they have personally
saved for retirement.
Not including Social Security taxes or employer-provided money, have you and/or your spouse
personally saved any money for retirement? (This study’s Total n=1,752; RCS Total n=615)
This study's respondents
RCS respondents ages 40+
71%
58%
38%
28%
Yes
No
Source: 2007 Retirement Confidence Survey (RCS) (Base: non-retirees ages 40+; n=615)
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
93
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Still, six in ten young Americans say they are
confident that they will eventually save enough to
retire comfortably.
How confident are you that, when you retire, you will have saved enough money to afford a
comfortable lifestyle in retirement? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Total
Gen Y
Gen X
Net Confident:
59%
Net Not Confident:
41%
47%
52%
44%
31% 28% 33%
11% 13% 10%
Very confident
11% 8% 13%
Somewhat
confident
Not too confident
Not at all confident
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
94
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Confidence in having saved sufficiently for a
comfortable retirement is expectedly higher among
those with higher incomes.
How confident are you that, when you retire, you will have saved enough money to afford a
comfortable lifestyle in retirement? (Total n=1,752; <$30K n=474; $30K-$49K n=405; $50K$79Kn=443; $80K+ n=352)
Total
<$30K
$30K-$49K
Net Confident:
59%
$50K-$79K
$80K+
Net Not Confident:
41%
54% 57%
47% 43%
43%
18%
11%
11%
10%
8%
Very confident
Somewhat
confident
34%38%
31%
28%
19%
Not too confident
11%12%10%8%
6%
Not at all confident
Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are
either married or live with a partner.
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
95
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Older Americans (who aren’t yet retired) are even
more likely to express such positive outlooks for
their retirement savings.
How confident are you that, when you retire, you will have saved enough money to afford a
comfortable lifestyle in retirement? (This study’s Total n=1,752; RCS Total n=615)
This study's respondents
RCS respondents ages 40+
This Study Net Confident: 59%
RCS Net Confident: 69%
This Study Net Not Confident: 41%
RCS Net Not Confident: 30%
47% 44%
31%
26%
19%
11%
Very confident
11% 11%
Somewhat
confident
Not too confident
Not at all confident
Source: 2007 Retirement Confidence Survey (RCS) (Base: non-retirees ages 40+; n=615)
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
96
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Employer-sponsored defined contribution retirement
plans are the largest expected source of retirement
income. Few plan to rely on Social Security.
Which of these possible sources of income do you think will provide you (and your spouse) with
the LARGEST share of income in retirement? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
41%
35%
46%
Employer-sponsored retirement
savings plan, like a 401(k)
Other personal savings/investments,
not in a work-related retirement plan
19%
20%
18%
Employer-provided traditional
pension
8%
5%
11%
7%
8%
6%
6%
9%
5%
2%
2%
2%
1%
1%
1%
15%
20%
12%
Social Security
Employment
The sale or refinancing of your home
Something else
Not sure
Total
Gen Y
Gen X
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
97
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Far more than the older generations, young adults
expect to rely on 401(k)-type retirement plans for their
retirement income.
Which of these possible sources of income do you think will provide you (and your spouse) with
the LARGEST share of income in retirement? (This study’s Total n=1,752; RCS Total n=615)
Employer-sponsored retirement
savings plan, like a 401(k)
41%
26%
Other personal savings/investments,
not in a work-related retirement plan
19%
22%
Employer-provided traditional
pension
8%
Social Security
7%
Employment
The sale or refinancing of your home
Something else
Not sure
15%
17%
6%
9%
2%
2%
This study's respondents
RCS respondents ages 40+
1%
3%
15%
3%
Source: 2007 Retirement Confidence Survey (RCS) (Base: non-retirees ages 40+; n=615)
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
98
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Very few young Americans have faith that the Social
Security system will provide them with benefits
comparable to those received by retirees today.
How confident are you that, when you retire, the Social Security system will provide you with
benefits of at least equal value to the benefits received by retirees today? (Total n=1,752; Gen Y
n=613; Gen X n=1,139)
Total
Gen Y
Gen X
Net Not Confident:
78%
Net Confident:
22%
44%
47%
39%
34% 34% 34%
19% 22% 16%
4% 4% 3%
Very confident
Somewhat
confident
Not too confident
Not at all confident
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
99
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Lack of confidence in Social Security's ability to
deliver comparable benefits is consistent, regardless
of education.
How confident are you that, when you retire, the Social Security system will provide you with
benefits of at least equal value to the benefits received by retirees today? (Total n=1,752; High
school or less n=243; Some college n=719; Bachelor’s n=571; Master’s or more n=219)
Total
High school or less
Some college
Bachelor's
Master's or more
Net Not Confident:
78%
Net Confident:
22%
4% 4% 2%
10%
3%
Very confident
49%
44% 43% 42%
42%
24%
19% 18%
16%
12%
Somewhat
confident
Not too confident
34% 37%
31% 35%31%
Not at all confident
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
100
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Older Americans express more confidence in Social
Security benefits than do younger Americans.
How confident are you that, when you retire, the Social Security system will provide you with
benefits of at least equal value to the benefits received by retirees today? (This study’s Total
n=1,752; RCS Total n=615)
This study's respondents
RCS respondents ages 40+
This Study Net Not Confident: 78%
RCS Net Confident: 63%
This Study Net Confident: 22%
RCS Net Confident: 35%
44%
35%
28%
34%
28%
19%
4%
7%
Very confident
Somewhat
confident
Not too confident
Not at all confident
Source: 2007 Retirement Confidence Survey (RCS) (Base: non-retirees ages 40+; n=615)
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
101
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Members of Generations Y and X have similarly low
expectations that Medicare will deliver benefits equal
to those received by retirees today.
How confident are you that, when you retire, the Medicare system will provide you with benefits
of at least equal value to the benefits received by retirees today? (Total n=1,752; Gen Y n=613;
Gen X n=1,139)
Total
Gen Y
Net Not Confident:
72%
Net Confident:
28%
44%
24%
Gen X
48%
39%
30%
28% 26% 29%
20%
3% 5% 3%
Very confident
Somewhat
confident
Not too confident
Not at all confident
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
102
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Confidence in Medicare maintaining current benefit
levels is low across education levels.
How confident are you that, when you retire, the Medicare system will provide you with benefits
of at least equal value to the benefits received by retirees today? (Total n=1,752; High school or
less n=243; Some college n=719; Bachelor’s n=571; Master’s or more n=219)
Total
High school or less
Some college
Net Confident:
28%
Bachelor's
Master's or more
Net Not Confident:
72%
50%
46%
44%
40%
40%
30%
24% 22% 25%
18%
30%
29%
28%
25% 28%
3% 4% 2%4% 6%
Very confident
Somewhat
confident
Not too confident
Not at all confident
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
103
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Again, the older generations surveyed in RCS have
more faith in Medicare benefits than younger adults in
this study.
How confident are you that, when you retire, the Medicare system will provide you with benefits
of at least equal value to the benefits received by retirees today? (This study’s Total n=1,752;
RCS Total n=615)
This study's respondents
This Study Net Confident: 28%
RCS Net Confident: 41%
RCS respondents ages 40+
This Study Net Not Confident: 72%
RCS Net Not Confident: 57%
44%
33%
32%
24%
3%
28% 25%
8%
Very confident
Somewhat
confident
Not too confident
Not at all confident
Source: 2007 Retirement Confidence Survey (RCS) (Base: non-retirees ages 40+; n=615)
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
104
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Over one-third anticipate helping their retired
parents financially; many are understandably unsure
whether they will help.
Do you expect to provide some sort of financial support to your parents during their
retirement? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Total
Gen Y
43%
37%
40%
33%
Yes
Gen X
34%
25%
29% 32% 26%
No
Not sure
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
105
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
African-Americans and Asian/Pacific Islanders are
especially inclined to expect to provide financial
support to their retired parents.
Do you expect to provide some sort of financial support to your parents during their
retirement? (Total n=1,752; Caucasian n=1,227; African-American n=150; Hispanic n=151;
Asian/Pac. Islander n=154)
Total
Caucasian
55%
African-American
Asian/Pac. Islander
55%
43%
37%
30%
Hispanic
34%
39%
29% 29%
29%31%26%28%
20%
Yes
No
16%
Not sure
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
106
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Financial Education and Literacy
107
Young people do not feel very knowledgeable about
certain critical financial tasks. Many say they know
more about their iPod than how to do their taxes.
How knowledgeable do you feel when it comes to…? (Total n=1,752; Gen Y n=613; Gen X
n=1,139)
Very knowledgeable Somewhat knowledgeable
Total
How to use an iPod
Gen Y
Gen X
Total
Eliminating or avoiding debt
Gen Y
Gen X
Total
How to stick to a budget
Gen Y
Gen X
Total
Buying a car
Gen Y
Gen X
Total
Doing your taxes
Gen Y
Gen X
40%
53%
31%
27%
27%
32%
34%
30%
32%
34%
30%
32%
33%
32%
26%
23%
29%
67%
27%
80%
58%
52%
49%
54%
48%
49%
48%
84%
84%
84%
80%
83%
77%
53%
49%
56%
40%
37%
42%
86%
82%
88%
66%
60%
70%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
108
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Gen Xers feel marginally more knowledgeable about
saving for retirement. Knowledge of how the Social
Security system works is low among both generations.
How knowledgeable do you feel when it comes to…? (Total n=1,752; Gen Y n=613; Gen X
n=1,139)
Very knowledgeable
Total
Buying a home
Gen Y
Gen X
Total
Saving for retirement
How to invest your money
outside of the workplace
16%
Gen X 14%
Total
Gen Y
41%
62%
34%
51%
46%
70%
15%
Gen Y
15%
18%
47%
62%
41%
52%
31%
33%
57%
66%
47%
50%
14%
31%
44%
14%
Gen Y 15%
Gen X 13%
31%
27%
34%
45%
42%
47%
Gen X
Total
How the Social Security
system works
21%
17%
24%
Somewhat knowledgeable
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
109
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Though most answer correctly, two in ten young
adults are not sure what it means to purchase a
company’s stock.
If you buy a company’s stock… (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Total
Gen Y
Gen X
57% 59% 56%
22% 23% 22%
7%
You own part of
the company*
* Correct answer
12% 12% 13%
9%
4%
You have lent
money to the
company
1% 1% 1%
You are liable for The company will
the company's
return your
debts
original investment
to you with interest
Not sure
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
110
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Research among FINRA’s experienced investors
show they are more likely than young adults in this
study to grasp what purchasing a stock means.
If you buy a company’s stock… (This study’s Total n=1,752; FINRA Total n=1,086)
FINRA’s Study
This Study
You have
lent money
to the
company,
7%
You own part
of the
company*,
57%
You are liable
for the
company's
debts, 1%
The
company will
return your
original
investment
to you with
interest, 12%
Not sure,
22%
You are
liable for the
company's
You have lent debts, 1%
money to the
company,
10%
The
company will
return your
original
investment
to you with
interest, 5%
Not sure, 5%
You own part
of the
company*,
79%
* Correct answer
Source: Financial Industry Regulatory Authority’s (FINRA’s) 2003 Investor Literacy Research, with 1,086 investment
decision-makers ages 21 to 69 who performed at least one stock, bond, or mutual fund transaction between October
2002 and April 2003
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
111
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Only one-quarter of young adults understand that
when interest rates are lowered, bond prices rise;
four in ten do not even venture a guess.
In general, if interest rates go down, then bond prices… (Total n=1,752; Gen Y n=613; Gen X
n=1,139)
Total
Gen Y
Gen X
40%
39%
31%
24% 23% 25%
23% 24% 23%
12% 12% 13%
Go down
Go up*
Are not affected
Not sure
* Correct answer
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
112
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
FINRA’s investors are more apt to be aware of the
relationship between interest rates and bond prices
than the young adults quizzed in this study.
In general, if interest rates go down, then bond prices… (This study’s Total n=1,752; FINRA Total
n=1,086)
FINRA’s Study
This Study
Go down,
25%
Go down,
24%
Go up*,
23%
Not sure,
23%
Not sure,
40%
Are not
affected,
12%
Go up*,
40%
Are not
affected,
12%
* Correct answer
Source: Financial Industry Regulatory Authority’s (FINRA’s) 2003 Investor Literacy Research, with 1,086 investment
decision-makers ages 21 to 69 who performed at least one stock, bond, or mutual fund transaction between October
2002 and April 2003
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
113
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Two-thirds of young people understand that riskier
investing generates higher returns in the long run.
True or False: In general, investments that are riskier tend to provide higher returns over time
than investments with less risk. (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Total
Gen Y
Gen X
65% 64% 66%
True*
16% 15% 16%
19% 21% 18%
False
Not sure
* Correct answer
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
114
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
FINRA’s investors are also more apt to know that
riskier investments yield higher returns. Young adults
are more likely to admit they don’t know.
True or False: In general, investments that are riskier tend to provide higher returns over time
than investments with less risk. (This study’s Total n=1,752; FINRA Total n=1,086)
This Study
FINRA’s Study
False, 16%
False, 19%
Not sure,
19%
True*, 65%
Not sure,
9%
True*, 72%
* Correct answer
Source: Financial Industry Regulatory Authority’s (FINRA’s) 2003 Investor Literacy Research, with 1,086 investment
decision-makers ages 21 to 69 who performed at least one stock, bond, or mutual fund transaction between October
2002 and April 2003
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
115
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Four in ten are uncertain about the reasonable rate
of return on diversified domestic mutual funds. Gen
Xers are more likely to answer correctly.
What is a reasonable average of annual return that can be expected from a broadly diversified
U.S. stock mutual fund over the long run? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
Total
Gen Y
Gen X
46%
41%
36%
28%
25%
20%
12%12%12%
14%15%14%
6% 5%
5%
10%*
15%
20%
8%
2% 2% 2%
25%
Not sure
* Correct answer
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
116
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
FINRA’s investors are more likely to know the average
rate of return on a diversified stock mutual fund, while
young adults are again more likely to be unsure.
What is a reasonable average of annual return that can be expected from a broadly diversified
U.S. stock mutual fund over the long run? (This study’s Total n=1,752; FINRA Total n=1,086)
FINRA’s Study
This Study
Five
percent,
12%
Five
percent,
15%
Ten
percent*,
25%
Not sure,
41%
Twentyfive
percent,
2%
* Correct answer
Fifteen
Twenty percent,
14%
percent,
6%
Not sure,
24%
Twentyfive
percent,
2%
Twenty
percent,
4%
Ten
percent*,
40%
Fifteen
percent,
15%
Source: Financial Industry Regulatory Authority’s (FINRA’s) 2003 Investor Literacy Research, with 1,086 investment
decision-makers ages 21 to 69 who performed at least one stock, bond, or mutual fund transaction between October
2002 and April 2003
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
117
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
For the most part, those in the younger generations
are unsure as to which investment vehicle produces
the best returns.
Over the last 20 years in the U.S., the best average returns have been generated by… (Total
n=1,752; Gen Y n=613; Gen X n=1,139)
Total
Gen Y
28%
25%
30%
Stocks*
Money Market accounts
Bonds
CDs
Precious metals
Not sure
* Correct answer
Gen X
13%
11%
15%
8%
11%
5%
8%
9%
8%
5%
4%
6%
38%
40%
36%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
118
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
A sizeable share of FINRA’s investors are also unsure
as to which investment vehicle generates the best
average returns, though most still answer correctly.
Over the last 20 years in the U.S., the best average returns have been generated by… (This study’s
Total n=1,752; FINRA Total n=1,086)
This study's respondents
FINRA respondents
28%
Stocks*
Money market accounts
13%
10%
Bonds
8%
9%
CDs
8%
6%
Precious metals
Not sure
* Correct answer
51%
5%
2%
38%
22%
Source: Financial Industry Regulatory Authority’s (FINRA’s) 2003 Investor Literacy Research, with 1,086 investment
decision-makers ages 21 to 69 who performed at least one stock, bond, or mutual fund transaction between October
2002 and April 2003
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
119
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Most understand the tax implications of certain
financial actions, though sizable shares are still
uncertain.
To the best of your knowledge, is the following statement true or false? (Total n=1,752; Gen Y
n=613; Gen X n=1,139)
True
Total
Interest paid on a mortgage
Gen Y
is tax-deductible (True)
Gen X
Interest earned in a bank Total
savings account is subject Gen Y
to federal income taxes (True) Gen X
When an employee retires, the Total
money they withdraw from their Gen Y
traditional 401(k) plan is subject
to federal income taxes (True) Gen X
Total 10%
Interest paid on credit card Gen Y 12%
bills is tax-deductible (False)
Gen X 8%
False
67%
53%
78%
Not sure
23%
32%
6% 16%
18%
16%
15%
66%
51%
10%
28%
21%
11% 12%
77%
59%
18%
48%
22%
67%
68%
59%
75%
23%
30%
16%
17%
22%
29%
17%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
120
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Only about three in ten young Americans grade
themselves an A or B when it comes to saving and
investing; more give themselves a D or F.
How would you grade…? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
A
Total 8%
How well you are
saving money
Gen Y 10%
Gen X 7%
Total 6%
How well you are
investing money
Gen Y 5%
Gen X 6%
B
23%
C
27%
25%
22%
21%
20%
22%
D
F
20%
22%
27%
27%
22%
18%
27%
18%
29%
17%
24%
18%
17%
26%
29%
28%
30%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
121
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Nearly half grade their parents an A or B for the job
they did teaching them about finances, while half give
their schools a D or F.
How would you grade…? (Total n=1,752; Gen Y n=613; Gen X n=1,139)
A
Total
The job your parents
did teaching you about
saving and investing
Gen Y
Gen X
18%
16%
Gen Y 5% 16%
Gen X 3% 13%
C
28%
D
22%
33%
21%
Total 4% 14%
The job your schools
did teaching you about
saving and investing
B
25%
26%
29%
23%
15%
23%
22%
23%
20%
25%
F
16%
10% 12%
19%
18%
33%
30%
36%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
122
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Sources of Information
123
Many say their parents are a major source of
financial advice. Gen Yers seek advice from their
parents more often.
Please indicate whether the following is a major, minor, or not a source of financial advice.
(Total n=1,752; Gen Y n=613; Gen X n=1,139)
Major source
38%
51%
28%
Total
Your parents (or in-laws)
Gen Y
Gen X
The internet
31%
30%
32%
17%
40%
20%
49%
31%
Gen Y
17%
22%
50%
48%
33%
30%
Total 11%
Periodicals (newspaper,
magazines, etc.)
32%
Not a source
Total
Gen X
Your friends or co-workers
Minor source
Gen Y 11%
49%
52%
40%
37%
Gen X 11%
47%
42%
Total 11%
44%
45%
43%
45%
47%
44%
Gen Y 9%
Gen X
13%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
124
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Financial professionals are a source of advice for
some, especially Gen Xers, while the media is a lessutilized source of financial advice.
Please indicate whether the following is a major, minor, or not a source of financial advice.
(Total n=1,752; Gen Y n=613; Gen X n=1,139)
Major source
Total
A financial professional
Gen Y
Gen X
Your (or your
spouse’s) employer
Total
Gen Y
Gen X
Total
Other relatives
Gen Y
Gen X
Total
Television or radio
Gen Y
Gen X
Total
Someone or something else
Gen Y
Gen X
23%
18%
27%
15%
14%
16%
10%
10%
9%
Minor source
Not a source
31%
33%
30%
46%
50%
43%
38%
41%
36%
47%
45%
48%
38%
48%
31%
7%
5%
9%
37%
36%
37%
8%
10%
7%
28%
27%
29%
52%
42%
60%
56%
59%
54%
63%
63%
64%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
125
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
After parents and financial professionals, the
internet is young adults’ third primary source of
financial advice.
Which of these would you say is your primary source of financial advice? (Total n=1,603; Gen Y
n=565; Gen X n=1,038) Among those who have more than one source of financial advice
36%
Your parents (or in-laws)
A financial professional
The internet
Your (or your spouse’s) employer
Your friends or co-workers
Periodicals (newspaper, magazines, etc.)
Other relatives
Television or radio
Something else
26%
20%
15%
23%
16%
14%
18%
50%
Total
Gen Y
Gen X
7%
5%8%
5%
5%
5%
5%
2%
7%
3%
4%
3%
2%
1%
3%
5%
4%
6%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
126
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Demographics
127
Demographics
Total
(n=1,752)
Gen Y
(n=613)
Gen X
(n=1,139)
Age
19 to 27
42%
100%
--
28 to 39
58
--
100%
Mean age
29
23
34
African-American / Black
12%
15%
11%
5
4
6
Caucasian / White
60
60
60
Hispanic, Spanish, or Latino
19
17
20
Pacific Islander
*
*
*
Other
2
2
2
Prefer not to answer
1
1
1
Single, never married
41%
59%
28%
Married
41
25
53
Unmarried, living with a partner
11
13
10
Divorced
4
1
7
Separated
1
*
2
Widowed
*
--
*
Other
1
1
*
Race
Asian
Marital Status
* Less than 0.5%
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
128
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Demographics
Total
(n=1,752)
Gen Y
(n=613)
Gen X
(n=1,139)
Current Employment Status
Employed full-time
65%
58%
69%
Employed part-time
16
22
12
Self-employed either full-time or part-time
6
3
7
Both full-time and part-time jobs
1
1
1
13
16
10
Employed full-time
70%
74%
69%
Employed part-time
7
8
7
Self-employed either full-time or part-time
5
3
6
Both full-time and part-time jobs
2
2
2
16
14
17
Unemployed
Spouse’s Current Employment Status
Unemployed
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
129
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates
Demographics
Total
(n=1,752)
Gen Y
(n=613)
Gen X
(n=1,139)
Income**
Less than $30,000
14%
24%
$30,000 to $49,999
27
30
27
$50,000 to $79,999
30
34
29
$80,000 to $99,999
11
6
14
$100,000 to $199,999
11
4
14
1
1
2
Own
42%
26%
54%
Rent
44
56
35
Some other arrangement
14
18
11
Yes
45%
25%
60%
No
55
75
40
$200,000 or more
9%
Home Ownership
Have Children Under the Age of 18
* Less than 0.5%
**Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are
either married or live with a partner.
Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State
130
of Gen X and Gen Y, conducted by Mathew Greenwald & Associates