In Phoenix, Young Adults Are More Optimistic Than Most Peers, but Leaning on Parents for Short-Term Financial Needs
Bank of America/USA TODAY Better Money Habits Report Shows Economic Issues Top Social Issues for Young Voters in This Election
A newly released Bank of America/USA TODAY Better Money Habits® Report finds that while 18- to 26-year-olds in the Phoenix region still rely on their parents financially, most say they are saving and feeling optimistic about what lies ahead.
Many of those surveyed, which includes the youngest millennials as well as the oldest members of Generation Z, still lean on others for financial support. Specifically:
Less than half – 48 percent – pay their own cell phone bills.
Forty-six percent still live at home with their parents.
- Just 37 percent do their own taxes without help from their parents.
At the same time, Phoenix young adults are feeling more upbeat about their financial futures than many of their peers across the rest of the nation. Eighty-three percent are optimistic, which is 13 percentage points higher than the national average. And, while they may not be covering day-to-day expenses, 52 percent report that they are saving for the future.
“Financial independence isn’t easy to achieve, especially for young adults who may be new to the job market or still in school,” said Patrick Clooney, Regional Operations executive, Bank of America. “If their parents are able to help out, that’s not necessarily a bad thing. It can give them a leg up financially, help them to manage their debt and begin saving. Regardless of their needs, we want to ensure that they have both the knowledge and skills required to take control of their finances moving forward.”
The need for additional support and resources is what inspired Bank of America to partner with Khan Academy to create Better Money Habits, a free educational resource aimed at empowering people to be more confident in their financial decision-making. The site delivers easy-to-understand information on a wide range of personal finance topics, including retirement, taxes, and buying a home.
A new definition of adulthood: less about age, more about financial independence
While 18- to 26-year-olds in Phoenix are exhibiting relatively strong financial habits, many still lean on others for support. And for that reason, they’re not necessarily feeling like adults. When asked to define adulthood, “financial independence” and “working/having a full time job” were the top answers. Additionally, 44 percent define adulthood as having achieved a financial milestone such as buying a house or car, compared to traditional life milestones such as getting married/starting a family (9 percent) or graduating from high school/college (1 percent).
For those who feel like adults, most say it’s because parents helped prepare them (51 percent) or they are living on their own (51 percent). For those who do not feel like adults, 66 percent say it’s because they don’t make enough money.
Nearly all wish they learned more about personal finance in school
While striving for financial independence, the majority of young adults in the Phoenix region say they did not learn enough about practical money matters in school. Though their education has set them up for success in other ways, only 29 percent said their high school education succeeded in teaching them strong financial habits. Of those who attended or are attending college, 42 percent said that their college education did a fair or poor job imparting financial lessons.
When asked what they wish they had learned more about in school, nearly all named a topic related to personal finance, more so than any other life-readiness skill. Specifically, 51 percent wish they had learned how to do taxes, 35 percent wish they had learned how to invest, and 29 percent wish they had learned how to manage monthly bills.
In upcoming election, economic issues are top of mind
With the campaigns in the home stretch, the report also surveyed young, first- and second-time voters in Phoenix. Contrary to the national narrative that young people today are overly idealistic, young voters in Phoenix are actually quite pragmatic:
The majority say economic issues (75 percent) are more important to them than social issues (25 percent) in how they vote.
For those with student debt, 49 percent say it will impact the way they vote.
- Asked which issues matter most to them, 28 percent named job growth/unemployment as a top concern.
While concerned about their pocketbooks, if forced to choose between two candidates – one who is best for their personal finances and one who is best for the country – 78 percent would prioritize what’s best for the country.
About the Bank of America/USA TODAY Better Money Habits Report
Bank of America and USA TODAY commissioned a survey of 2,180 18- to 26-year-olds to explore their views on personal financial matters. The survey was conducted online, in both English and Spanish, during the period of July 1–July 21, 2016. Interviews were conducted by GfK Public Communications and Social Science, using GfK’s KnowledgePanel®, a statistically representative sample source used to yield results that are projectable to the American population. To qualify, respondents had to be 18 to 26 years old. The margin of sampling error for national data is +/- 3.5 percentage points at the 95 percent confidence level. Margin of error for the state of Ohio and the Charlotte, N.C.; Columbia, S.C.; Dallas-Fort Worth, Texas; Detroit, Mich.; Philadelphia, Pa.; Wilmington, Del.; Phoenix, Ariz.; Seattle-Tacoma, Wash.; San Francisco, Calif.; Boston, Mass.; and Raleigh-Durham, N.C. DMA augments are higher than that of the national sample.
About Better Money Habits®
Bank of America has made a substantial commitment to address the need for better financial education by partnering with Khan Academy – a nonprofit with the mission of providing a free, world-class education to anyone, anywhere. Together, we’ve developed Better Money Habits®, a free, objective online financial resource that pairs Khan Academy’s expertise in online learning with the financial know-how of Bank of America. Better Money Habits® delivers simple, easy-to-understand information on a wide range of personal finance topics, including saving, budgeting, building credit, paying down debt, paying for college and buying a house.
About Bank of America Environmental, Social and Governance
At Bank of America, our focus on Environmental, Social and Governance (ESG) factors is critical to fulfilling our purpose of helping make people’s financial lives better. Our commitment to growing our business responsibly is embedded in every aspect of our company. It is demonstrated in the inclusive and supportive workplace we create for our employees, the responsible products and services we offer our customers, and the impact we help create around the world in helping local economies thrive. An important part of this work is forming strong partnerships across sectors – including community and environmental advocate groups, as well as nonprofits – in order to bring together our collective networks and expertise to achieve greater impact. Learn more at www.bankofamerica.com/about, and connect with us on Twitter at @BofA_News.
Reporters May Contact:
Colleen Haggerty, Bank of America, 213.621.7414