Young American investors feel well prepared to handle their own budgets and are optimistic about the future — but that does not mean they trust financial advisers.
"With access to online resources and tools, younger generations are now able to take financial matters into their own hands to gain the financial confidence they need to succeed," Stuart Rubinstein, managing director of client engagement at TD Ameritrade, Inc., said.
Maritz Inc. conducted a survey of 963 adults between the ages of 21 and 80 for TD Ameritrade, and found 52% of Gen X (age 35 to 46) and 64% of Gen Y (22 to 34) relied more on websites than any other source for financial information. Boomers and seniors were more likely to turn to TV, radio and newspapers.
A third of the Gen Y respondents relied on social media for news about the economy and financial markets, compared with 27% of Gen X, 21% of boomers (age 47 to 66), and 14% of seniors (66 and up).
Only 21% of Gen Y and 32% of Gen X turn to professional investment advisers for financial news, compared with 38% of boomers and 37% of seniors. Gen Y is most skeptical of professional investment advisers, with only 10% of respondents trusting them most as a valued source of news.
Young people are learning about money and taking responsibility for their own budgets as teenagers, the survey found. Nearly half the Gen X and Gen Y respondents said they got their first money lessons at age 12 or younger, while 62% and 69%, respectively, said they took responsibility for money in their teens, compared with 53% of boomers and 41% of seniors.
"It appears that parents are learning from their financial mistakes and are trying to better prepare their children by teaching them financial lessons at an early age," Rubinstein said. "Teaching children simple financial lessons such as budgeting, balancing finances and saving at an early age can help set them up for financial success in the future."
A large majority, 74% of respondents, felt that schools should take more responsibility for teaching children how to save and manage money. Among seniors, 44% thought employers should teach employees about money management, compared with just 22% of Gen X and Gen Y who agreed.
Priorities differed across the generations. For example, 39% of seniors and 29% of Gen Y stated that their top priority was managing income and expenses so they could live within their means; 34% of boomers were accumulating money for retirement, with only 26% "completely confident" they would accomplish this before retirement. A quarter of Gen X respondents were focused on reducing debt, with 34% "completely confident" they would reach their goal.
While boomers, Gen X and Gen Y agreed their biggest regret was not saving enough for the future, Gen X regretted this the most (62%).
Nearly 60% of seniors said they felt they had achieved financial success, and 19% percent reported they were on their way. About 20% thought they might fail or were unlikely to succeed.
Forty-eight percent of boomers said they were on their way to reaching financial success, and 18% said they had already achieved it. A fifth said they were working on becoming financially successful but might not succeed, and 12% felt they were far behind where they wanted to be and were unlikely to achieve financial success.
Fifty-six percent of Gen X felt they were on their way to reaching financial success, but 20% felt that while they were working at becoming financially successful, they might not succeed, and another 13% felt they were far behind their goals and were unlikely to reach them.
Of the nearly 30% of respondents who were struggling to achieve financial success, 21% of seniors reported that medical expenses were a problem, while 23% of boomers, 18% of Gen X and 20% of Gen Y said that their expenses were rising faster than their income.
