A new study of young working Americans reveals a shift toward more conservative behavior in financial matters and employment decisions.
Three out of four Generation Y workers feel secure in their jobs, but more than 70 percent are very concerned about their finances and have set the goal of daily money management and budgeting as their biggest focus.
Fidelity Investments’ study, The Fidelity Generation Y Study, looked at the attitudes and behaviors of more than 1,000 employed Americans ranging from 22 years to 33 years old.
Most Gen Y individuals are using mobile technology to stay updated on their cash flow situations with 64 percent reporting they typically check their balances online before making a purchase of $300 or more.
On average, this younger generation holds more than three credit cards with one-fifth (20 percent) carrying a balance greater than $10,000 and one in four (25 percent) believing they will never be free of credit card debt during their lifespan.
Many young workers surveyed (41 percent) said the economic crisis has made their generation more conservative, which is reflected in not only their financial decisions but also their employment choices. More Gen Y individuals show a reluctance to "job hop" with one in four indicating the intent to remain with a current employer until retirement, up from 14 percent of those surveyed in early 2008.
Gen Y individuals (75 percent) agree work-life balance still drives their career choices, similar to what they said in 2008, but workplace benefits have taken on greater importance. The majority of Gen Y (62 percent) individuals said the quality of benefits packages influences their choice of employer with slightly more (64 percent) stating it also impacts their job loyalty. When asked which benefits are a "must have," Gen Y individuals ranked health insurance first (82 percent), followed by paid vacation time (68 percent) and access to a retirement savings plan (57 percent).
"The change in the mindset of young workers has been remarkable," said Brad Kimler, executive vice president of Fidelity’s consulting services business. "Their attitudes and views toward their employer and finances are now more conservative and reflective of their parents’ generation, yet this generation will be faced with different challenges including higher debt, greater responsibility for costs associated with benefits and less access to traditional pensions."
Nearly half (47 percent) of Gen Y employees with an employer-sponsored retirement savings plan report that managing everyday finances, such as paying the mortgage or credit card debt, is a more crucial obligation than saving for retirement. The majority (57 percent) believe that these types of savings plans are the best way to save for retirement. More (18 percent) now consider saving for retirement to be their "most crucial goal," versus just 13 percent in 2008.
