I think the recession prompted me to be far more forward thinking and far more focused than I would have been. It made me put a lot more time and thought into what I wanted to do and what would be realistic. —Timi Jorgensen, a student at Utah Valley University
When it comes to politics, millennials are an elusive demographic. According to a recent Pew study, "half of millennials now describe themselves as political independents," more so than any generation before them. As the Pew study also shows, millennials are setting themselves apart in racial diversity, religiosity and even trust levels.
But when it comes to financial attitudes, they aren't paving new roads so much as they are harkening back to a generation that was born into the most economically turbulent era in American history.
According to a new study by UBS, a global financial services company based out of Switzerland, the millennial attitude toward money is "markedly conservative, more like the WWII generation who came of age during the Great Depression and are in retirement."
The study, which surveyed over 1,000 millennials about their financial attitudes, concludes that the aptly named dot-com generation's access to technology and information, as well as coming of age during a time of "dramatic economic and market volatility that constrained their job prospects and earning abilities" has caused them to see the world of money more conservatively than their parents. "While optimistic about their abilities to achieve goals and their financial futures, millennials seem somewhat skeptical about long-term investing as the way to get there."
In other words, "millennials are the most worried of all generations," the study concludes.
To Jacob Sybrowsky, an assistant professor of personal financial planning at Utah Valley University, this news doesn't come as a surprise.
"I’ve seen students that feel a tremendous amount of pressure to save for retirement," Sybrowsky said in an interview.
Though he is mostly pleased by their more restrained approach to finance, Sybrowsky is also worried that it may be holding some of his students back."They put off things that can help them educationally and help them keep balance," he said. "Sometimes you need to put your arms around them and say, 'it’s OK to go see a movie.’ ”
But such concerns can be hard to calm, Sybrowsky concedes, principally because the recession has left a bad taste in many millennials' mouths.
"I’m not convinced that millenials understand market volatility per se," he told the Deseret News. But watching their parents struggle through a tough economy has certainly made a lasting impression.
"A big part of the anxiety came from the fact that the recession hit right when we were being considered adults," Timi Jorgensen, one of Sybrosky's students, said in an interview.
"Most of us are not in a profession yet. There are adults that are having a really tough time. If those are the adults we’re interacting with, that can be a pretty humbling experience."
In fact, Jorgensen's experience in higher education can be seen as largely representative of the millennial experience. While she initially chose a field of study she was passionate about (secondary education, hoping to one day teach Spanish) Jorgensen became increasingly concerned about student debt. To help calm her nerves, she chose to move back in with her parents and attend cosmotology school, all the while working to avoid having to take out loans.
Eventually the financial burden became too great, and she chose not to complete cosmetology school. "My family was so debt adverse and that really rubbed off on me. I never stopped to consider the benefits of taking out student loans," she said.
Jorgensen is not alone. Reuters reported in 2012 that of all industrialized nations, the United States has the highest rate of college dropouts. "Many students approach the dropout decision as a simple cost-benefit analysis," Lou Carlozo wrote for Reuters. "They ask themselves whether leaving will put them financially ahead of where they'll be after amassing four years of student loan debt in a lukewarm job market."
As Marketwatch recently reported, an increasing number of students have loan debt in the six-figure range, and "more than one in 10 student loan balances are more than 90 days delinquent." Such statistics can be crippling to the ambitions of even the brightest students.
But unlike most of her fellow students who put a pause on their schooling, Jorgensen decided that getting a degree was still worth it, as long as it was the right degree.
As time passed, Jorgensen got married, had a child and began a new chapter in her young-adult life. She returned to school at Dixie State where she caught word of a new program at Utah Valley University that would focus on personal and family finance. “I really enjoyed that client relationship from hair styling, but I wanted to do something applicable to daily life,” she said, and personal financial planning seemed right up her alley.
Having lived through the fear of financial instability, studying finance has helped Jorgensen to not "react out of fear," as her professor, Sybrowsky, would say. "There is this belief that ‘you need to be afraid and be passionate with fire in your belly or you’re not going to make it in the world," she said. But she prefers a more hopeful approach.
Jorgensen's optimism touches on a key finding in Pew Forum's recent study on trends among her generation. Despite being considerably worse off financially in relation to both their parents and their grandparents (hence the resurgence of a more restrained view toward investing), the Pew study found that millennials are nevertheless "extremely confident about their financial future."
"I think the recession prompted me to be far more forward thinking and far more focused than I would have been," Jorgensen said. "It made me put a lot more time and thought into what I wanted to do and what would be realistic.”
"I think we should look at this as a very positive trend," Sybrowsky concluded about the UBS study. "I would much rather have a generation that will say ‘I will fight for my own financial freedom and not just be taken care of.' I hope that this is evidence of that shift."