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 Wisconsinreveals 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%).
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.”