A new Harris Poll among over 500 U.S. millennials (ages 24-39), commissioned by DailyPay, the Funding Our Future Campaign, and the Center for Financial Security at the University of Wisconsin reveals that millennials have been hit hard financially by the global pandemic. More than half (52%) note that their savings on hand have declined since the beginning of the COVID-19 pandemic and more than 2 in 5 (44%) cite they have either no savings (17%) or not enough savings to cover a $400 emergency expense (27%).
“This data shows the resilience of younger generations in the face of the second major economic shock of their financial lives, as well as highlights how vulnerable people are today, especially given the effects of the pandemic on top of student loan debt and other concerns,” said J. Michael Collins, Director of the Center for Financial Security. “It is also notable that Social Security is still very much viewed as being important, even among young people, as a pathway to financial security.”
The current economic situation for millennials is likely even more daunting for those without a college degree. The research shows nearly 3 in 10 (29%) of those with only a high school education say they have no savings at all, compared to just 5% of those with a college degree or higher. Similarly, lower-income millennials are less likely to have savings (33% of those with household income (HHI) of less than $50k vs. 7% with HHI of $50k+) and more likely to report that their savings have been depleted since the beginning of the COVID-19 pandemic (58% with HHI of less than $50k vs. 45% with HHI of $100k+).
The lack of savings is seen as a long-term obstacle as the data also reveals that only about a third (35%) of millennials feel like they are on the right track to meet their retirement goals. The rest either feel they are not on track (35%), are unsure (16%) or do not have retirement goals (13%).
Having financial resources later in life may also be a major concern for millennials. About one-third (33%) believe they won’t have enough money saved in order to retire comfortably until age 70 or older (17%) or don’t think they will ever have enough saved to do so (16%). Many employed millennials do not have access to retirement savings programs through work as 28% say their employer does not offer such programs and 8% are not sure if they do.
Millennials are mixed in terms of where they have their emergency savings — 61% have some in a bank account, while 28% have some invested in investment accounts or the stock market and a quarter (25%) have some in cash.
In regard to the hot-button issue of student debt, 57% of millennials either currently owe or have previously paid off student loans, and 66% support either full or partial federal student loan forgiveness.
More information on the study can be found HERE.
“Millennials already faced a number of unique hurdles around achieving financial security, including being strapped with student loan debt, facing more than one recession while in or entering the workforce, and lack of portability of benefits as they switch jobs,” said Kara Watkins, Funding Our Future’s campaign manager. “This survey highlights the need for actionable tools and solutions to help the largest share of our workforce save for an emergency and their future.”
“This data shows the resilience of younger generations in the face of the second major economic shock of their financial lives, as well as highlights how vulnerable people are today, especially given the effects of the pandemic on top of student loan debt and other concerns,” said J. Michael Collins/Center for Financial Security. “It is also notable that Social Security is still very much viewed as being important, even among young people, as a pathway to financial security.”
“This research is a fascinating window into the financial behaviors of millennials,” said Matthew Kopko, Vice President of Public Policy for DailyPay. “About half of millennials feel like they are not on the right path to retirement or are unsure if they are, and over half have depleted savings during the pandemic. An economy that was already difficult for young workers is getting even more challenging in some critical ways.”
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About Funding Our Future:
The first coalition of its kind, the Funding Our Future campaign is a bipartisan and cross-sector coalition of more than 40 organizations working towards retirement security for all Americans. The campaign was launched in 2018 by the Bipartisan Policy Center, and today has representation from the education and nonprofit, trade association, and corporate sectors, showcasing the broad base of support this issue has and requires across the country. Our campaign lifts up partner research and reports, co-hosts events, and educates the public and policymakers about these critical issues. For more information, visit www.fundingourfuture.us.
The Center for Financial Security (CFS) at the University of Wisconsin-Madison is a multidisciplinary research center that conducts applied research in household finance, consumer behavior and financial security over the life course with an emphasis on informing policy and practice with evidence-based strategies. As a designated center within the Social Security Administration’s Retirement and Disability Research Consortium, the CFS Retirement and Disability Research Center oversees research, dissemination, and training programs, which develop evidence that assist policymakers, the public, and the media in understanding issues in Social Security, retirement, and disability policy, especially related to economically vulnerable populations.
Contact: Sehrish Sayani
This survey was conducted online within the United States by The Harris Poll on behalf of DailyPay from November 17-19, 2020 among 2,075 U.S. adults ages 18 and older, among whom 593 are Millennials ages 24-39. This online survey is not based on a probability sample and therefore no estimate of theoretical sampling error can be calculated. For complete survey methodology, including weighting variables and subgroup sample sizes, please contact David Schwarz at DailyPay at firstname.lastname@example.org.