For anyone concerned about younger generations — Gen Y/Millenials — having a sincere lack of trust in Wall Street and investing in America’s future, your fears are now warranted.
Based upon Allstate’s Heartland Monitor poll, the spending/saving/investing priorities for Millenials are:
Given a hypothetical $100 to invest, Millennials preferred saving in a bank or paying down debt to buying a home or investing in the stock market.
Saving the money in a bank – 28.9%Paying off outstanding debt – 26.9%Buying a house or condominium – 19.6%Investing in a retirement savings program (like an IRA or 401k) – 16.3%Investing in the stock market – 8.3%
Pretty huge shift in cultural beliefs! My late Generation X mindset would have been, and still is, I’ll buy $100 worth of Exxon Mobil.
According to Allstate’s poll, the average debt load carried by Gen Y is $22,000 per person, so I can understand they want to be unshackled from their student loans, credit card debt, and no longer be a slave to their stuff as quickly as possible. But still, this is a pretty big shift in thought processes considering that many older American’s (including me) believe the best place to grow your money is to place it in the stock market… not in a savings account.
The only critique I have of this particular question in general is that $100 isn’t all that much in 2010 dollars, so I’m curious if the study had asked what would Millenials do with, say $10,000, instead of just $100. Ten thousand dollars seems like a more reasonable amount to invest, especially when you consider that $100 can barely buy you a week’s worth of groceries or 3 tanks of gas these days.
For additional polling data, checkout Allstate’s press release here and tabulated polling results here (opens to pdf file).