![]() ![]() ![]() Factor analyses of these estimates yielded five correlated, but distinct factors, suggesting that unrealistic optimism is not a unidimensional construct. If your child is entering this stage of life, offer them the right resources for building that foundation.To examine the dimensions of unrealistic optimism, 635 college students indicated their relative likelihood of experiencing 25 health problems commonly used in studies of unrealistic optimism. Setting a solid financial foundation in the beginning stages of adulthood can make the next steps far easier. But it can also be harnessed in a positive way. The overall optimism unveiled in the study can be dangerous if paired with bad financial habits. But it’s certainly something to think about. Admittedly, this survey may or may not give a good overall indication of the total population in that age range. You can take the numbers and percentages from this survey for what they are, which is a small sample of 2,000 young adults. That’s a great stepping stone for getting the next generation up-to-speed on their financial futures. Of course, this trust is only beneficial if the parents are providing sound advice and making sound decisions themselves! One of the best things parents can do for their young adults is to provide them access to an education session with a financial advisor. In fact, it found that 69 percent of young adults trust their parents to give them sound advice. One positive note from the survey is that young adults are not averse to receiving financial advice. ![]() That’s a lot of debt to be saddled with before you’ve even begun your career! The younger generation needs to be better prepared than their predecessors to navigate through these financial obstacles early in their adult lives. student loan debt is $1.52 trillion and encompasses 44.2 million Americans.Īnother telling statistic: The average graduate in the class of 2016 accumulated more than $37,000 in student loans. That makes it higher than both credit card and auto loan debt! According to the personal finance site “Make Lemonade”, the total U.S. Student debt now ranks as the second-highest consumer debt category, behind only mortgage debt. Statistics show that regardless of their optimism or current understanding of debt, student debt is rising at an alarming rate. Some people may attribute the negative findings in the survey to a broad sense of entitlement among millennials and young adults. #Are age 21 and under unrealistic optimism full#Despite a lack of knowledge about debt and an unwillingness to pay their debt down, these young adults expect to retire at age 60 - seven years earlier than full Social Security benefit eligibility for their age bracket! That’s rather unrealistic given the survey results! The Reality of Student Loan Debt Here’s where it starts to get really interesting. More than half (51 percent) said they currently had some sort of debt, but only 3 percent would pay down that debt if given an extra $1,000. The concerning part of Schwab’s debt analysis, however, was this age group’s insufficient understanding of debt and lack of motivation to pay it down. After all, many of them have rapidly been accumulating student loan debt instead of earning full-time wages. This front-loading of debt compared to savings can be somewhat expected for young adults ages 16 to 25. In the survey sample, the average savings was $1,628. The survey also analyzed the topic of debt for early-college to post-grad age young adults. Healthy Confidence or Unrealistic Optimism? However, it typically isn’t wise to depend on them as a part of your overall financial plan. Inherited assets are certainly beneficial. Ultimately, it could adversely impact their financial futures. Why is this worth noting? Misplaced optimism about an inheritance could influence young adults’ financial decisions in the short and intermediate term. Bureau of Labor Statistics reported that between 19, only 21 percent of Americans actually received an inheritance of any kind, much less a windfall. Sounds reasonable, right? However, in 2011 the U.S. But if you’re a young adult, don’t celebrate prematurely! The Schwab survey found that more than half (53 percent) of young adults believe their parents will leave them with an inheritance. You may have heard there’ll be a major shift in wealth to the millennial generation as more baby boomers approach retirement. But should they be? Inheritance Coming? Don’t Count on It! A recent financial literacy survey conducted by Charles Schwab discovered some interesting findings about how young adults (ages 16 to 25) view their current and future financial well-being. ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |