Younger Generations Seek to Solve Global Issues but Worry about Financial Future, Study Reveals
A recent study conducted by the TIAA Institute and Business for Impact’s AgingWell Hub at Georgetown University has shed light on the shifting priorities and concerns of younger generations in the United States. The data shows that Gen Z and younger millennials, aged 24 to 35, have more confidence in their ability to contribute to solving global problems than they do in securing their own financial futures.
The study, released on Thursday, revealed that over half (56%) of respondents in this age group believe they can play a role in addressing critical global issues such as climate change, social injustice, and political division. This finding indicates a growing sense of activism and a desire to make a positive impact on the world. However, when it comes to personal finances, young adults hold a more pessimistic view, causing concern among researchers.
A significant majority (51%) of the respondents expressed doubts about their financial prospects, stating that they do not expect to be as well off as their parents. Jeanne de Cervens, the director of the AgingWell Hub, emphasized the need to address this sentiment early in young workers’ careers, highlighting the importance of employers, community groups, and others in guiding them towards financial planning and advancement opportunities.
Despite the concerns about their financial futures, Gen Zers and young millennials are taking steps to save for retirement. The study found that nearly three-quarters (72%) of respondents are currently saving in a retirement plan, either through their workplace or independently. However, chronic inflation poses challenges for these individuals as they struggle to envision how they can make progress in their careers and build wealth.
The survey also revealed that 42% of young adults are living paycheck to paycheck, while only 33% feel prepared to handle unexpected major expenses. Surprisingly, although the majority are saving for retirement, just over a third identified retirement savings as one of their top three financial goals.
One contributing factor to this financial uncertainty is the source of advice sought by young adults. The study found that approximately 20% of respondents turn to social media for retirement planning guidance, which may not always provide accurate or reliable information. Surya Kolluri, the head of the TIAA Institute, emphasized the importance of seeking out financial advisors who can help craft personalized plans aligned with short- and long-term financial goals. Additionally, Kolluri suggested that employee retirement plan sponsors could automate contributions, offer plans with guaranteed lifetime income, and enhance access to financial wellness tools to support younger workers.
“The pessimism many young people feel about their financial futures requires our support,” Kolluri stated. “We owe it to them to promote their financial wellness and help them achieve retirement security so they can continue making a difference in the world long after their youth.”
The study’s findings highlight the need for comprehensive financial education and support systems that empower younger generations to navigate the complexities of personal finance while pursuing their goals of making a positive impact on global challenges.