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 Courtesy WSFS Bank
 Courtesy WSFS Bank

Majority of Millennials and Gen Zers view their financial situations positively, new study shows

A recent WSFS Bank Study found general optimism regarding the financial situation of younger generations.

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A 2021 WSFS Bank Study of Millennials and Gen Z consumers showed that 65% of respondents describe their overall financial situation as either “good” or “excellent,” and 58% of respondents said they are optimistic about achieving their financial goals one day.

The nationwide study surveyed 2,005 people between the ages of 18 and 40, and asked them to describe their financial fears and goals, as well as how their experiences have been influenced by previous generations.

While most of the individuals surveyed showed optimism relating to their finances, 43% said they frequently have trouble paying everyday living expenses; 19% of which said it happens to them “constantly.”

“Despite the challenges faced, these generations still view their overall financial situations positively, and with the help of online resources and financial institutions they can increase their money management and financial acumen,” said Vernita Dorsey, SVP and Director of Community Strategy at WSFS Bank. 

For Hispanics and Latinos who took part in the study, 65% of respondents described their financial situation as “good” or “excellent,” but just 39% were optimistic about achieving their financial goals.

For Hispanics and Latinos who took part in the study, 65% of respondents described their financial situation as “good” or “excellent,” but just 39% were optimistic about achieving their financial goals.

Also, 36% of Hispanics and Latinos said they frequently have trouble paying everyday living expenses. 

The study highlighted some of the various factors that play a role in these numbers, one of which is financial literacy.

According to the study, 61% of respondents agreed that most of what they’ve learned about finance was through osmosis, with 75% of men and 49% of women agreeing.

Most learned financial lessons from parents (36%), followed by their romantic partners (33%), grandparents (31%), teachers (29%), and siblings (27%).

For Hispanics and Latinos, 41% were more likely to cite their romantic partners as their main source of financial lessons — 8% higher than total respondents. 

Just 23% of total respondents said they learned those skills in schools, and 17% from their bank or financial institution.

Just 23% of total respondents said they learned those skills in schools, and 17% from their bank or financial institution.

“With only 23% of respondents saying they learned financial skills in school, it is clear a financial literacy gap exists that, if addressed, could help build solid foundations prior to reaching adulthood,” said Dorsey. “It’s important to address these educational gaps so future generations are more comfortable discussing and learning about finance from trusted family members and teachers, and to use the resources their financial institutions offer, so they are less likely to feel like they’re on their own to figure things out.”

Meanwhile, Millennials and Gen Z have also lived through a number of recessions and other major financial events, including the 2008 Recession, 2015 mini-Recession, the Occupy Wall Street movement, the 2017 Tax Cuts and Jobs Acts and the current ongoing COVID-19 pandemic.

Each of those events have left respondents worried about future setbacks, with 48% saying they were worried about losing a job or taking a pay cut, 44% worried about filing for bankruptcy and 40% worried about making bad financial decisions.

“While Millennials and Gen Z have faced many obstacles, they’ve also shown resilience, including during COVID-19,” said Dorsey.

As a likely result of adaptable money habits, just 10% of respondents said the pandemic has negatively impacted their overall financial situation.

47% of Hispanic or Latino respondents were more likely to put more toward retirement since the start of the pandemic, compared to 42% of total respondents.

Overall, the study highlights that the younger generation has been able to endure many financial challenges, while still being resourceful, optimistic and stable. 

“It’s never too late for any generation to prioritize money management to build financial stability and wealth for yourself and future generations,” said Dorsey. 

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