While the majority of young Americans feel like they're just getting by financially, new research from Edward Jones suggests that these
This week, Edward Jones released findings from research conducted in partnership with Next360 Partners and MarketCast to better understand what matters most to the more than 76 million Americans between the ages of 18 and 34.
Defined in the study as "GenNext," these individuals represent a life stage known as emerging adulthood, meaning they are consumers and investors with significant decisions to make about their future.
The study found them to be a resilient and optimistic group despite having experienced heavy life challenges that began with early memories of their families' experiences during the Great Recession, and including more recent events such as the COVID-19 pandemic, rising inflation and job transitions.
"Our research offers a deeper understanding of GenNext, an age group defined by their shared experiences, not the year they were born," Lena Haas, head of wealth management advice and solutions at Edward Jones, said in a statement. "With most worried about rising costs and an inability to save, this will have vast implications for the wealth management industry. Our purpose calls us to identify how we might help this age group plan and reach their life goals — across health, family, purpose and finances."
Glass half full
The majority of Americans 18 to 34 (80%)
But these Americans say they are still juggling jobs, school, gig work and other priorities that come first.
Even with their limited time in the workforce, nearly 1 in 5 (19%) have experienced being laid off from a job. While they think positively about retirement, GenNext doesn't expect to enjoy the same level of financial stability as their parents or grandparents — and only 31% currently have a retirement account.
Their main priority is being comfortable, saying that they want enough money to have a meaningful life, and they view the pursuit of purpose, not financial accumulation, as the main value of a career.
Employer loyalty is less important to this group, and the career ladder no longer exists for them. The study says they are instead planning for what the research refers to as "pogo stick careers," where they are highly mobile and move from one job to another.
GenNext are comfortable wearing multiple hats, with many looking to "side hustles" to fund their lifestyles outside basic expenses. Only 1 in 10 (13%) associate a career with success and achievement.
"The study challenges many of the popular assumptions about today's young adults," Joe Coughlin, senior advisor to NEXT360 Partners, said in a statement. "Despite many stereotypes that range from funny to frivolous, GenNext is hardworking, ambitious, and navigating the uncertainty that goes both with their life stage and the social and economic challenges of life today."
Coughlin added that GenNext are "happy homebodies," with more than half (58%) reporting they feel most fulfilled when spending time with family and friends.
"Although they may have a clear picture of what they want their lives to look like in the next five years, only one in three (36%) are prioritizing finances to get there," Coughlin said.
How financial advisors can help
GenNext cited a short-term mindset when it comes to finances, focusing on everyday expenses, budgeting and saving for large purchases over other financial matters. Only one in 10 (13%) have paid off college debt, only about half (57%) have health insurance and less than a third (27%) have life insurance.
The Edward Jones study says to thrive, those in this life stage could benefit from financial education and professional advice, but only 12% go to a financial advisor to discuss their finances. The majority (52%) speak with their parents, and
Though more than three-quarters (78%) of GenNext do not currently work with a financial advisor, 41% of those who don't say they plan to someday and 68% view financial advisors as a sounding board for ideas.
And while GenNext grew up with the internet, 66% of GenNext prefer in-person interactions with their financial advisors. Coughlin noted that, "GenNext are ushering in new expectations for the future of advice, one that is not digital alone but omnichannel, goes beyond financial discussions and where personal is premium."
"Working with a financial advisor can improve your financial knowledge and confidence and help you feel more in control," added Haas. "Our research found that 68% of GenNext don't think they have enough income or savings for professional financial advice. But it's never too early to get started. Financial advisors can remove burden and complexity and help you focus on the most important next steps."
