Too many of the generation known as millennials — those born from the mid-1980s until the late 1990s — are financially troubled, raiding retirements savings and resorting to payday loans services, a recent study shows.
More than 80 percent of college-educated millennials said they have at least one long-term debt in a survey by national audit firm PricewaterhouseCoopers done with the help of the George Washington University Global Financial Literacy Excellence Center.
Nearly a third are overdrawn on their checking accounts, the study says. And more than 40 percent are using payday loans, auto title loans and other “alternative financial services” just to get by.
“They have been brought up to where they have easier access to various different ways to get money, and to lose money, than any other generation has,” said Shannon Schuyler, PwC chief purpose officer and corporate responsibility leader. “They have a lot of opportunities but also a lot of different ways to get themselves into trouble.”
Millennials are hungry for experiences, eager to dine out and travel when they can. Their average time staying at a single job is just 18 months, Schuyler said.
“They’re in the standpoint of live-for-now versus live-for-the future,” she said.
The Springfield-based Baker Krizner Financial Planning is working to expand their client base to the millennial age group to get them on track at an earlier age, said Eric Powell, a 27-year-old certified financial planner and fellow millennial.
Like most millennials, Powell graduated from Ohio State University with significant student loan debt, he said. The North High School graduate often works with younger clients on structuring finances to help pay off other debt or work on retirement.
Without financial knowledge, millennials don’t often know where to start regarding their finances, Powell said. He often answers questions for friends on basic information, rather than deeper topics such as investing
Introductory personal finance should be taught to high school students before they take on college loan debt, Powell said. He would also like to see it become a requirement for college students as well.
“Navigating not only the credit card world, but mortgages and student loans, personal loans – all of those things people are going to face at one point or another,” Powell said. “Just having the basic background knowledge would be helpful.”
Junior Achievement does a great job with financial education and has curriculum for all ages, said Powell, a member of the organization’s board. However, schools could focus on semester-long classes with education on opening a checking account or balancing a checkbook.
“If it was a semester-long class, students would pick up a couple things from the banking side of things,” Powell said.
Not all millennials are struggling. Several area millennials said it’s up to the individual and his or her choices.
Briana Snyder, 27, owns the downtown Dayton boutique and party shop, Confetti. She also is a wedding photographer, and she’s working with Max Spang, also 27, to launch a corporate photography and video business.
Snyder said she took a single finance class in high school. But she graduated from the University of Dayton in three years and hasn’t used a credit card in her entire life.
“Anything I know I had to figure out,” Snyder said.
Besides running a trio of businesses, Snyder is working with like-minded friends on a “mobile market” for areas of Dayton lacking grocery stores with fresh fruits and vegetables.
For Snyder, every penny matters, and so does every minute.
“There are very few days where I don’t work at all — on my days off, I usually spend at least a little time catching up on emails, orders for the shop,” she said.