In the next couple of months, millions of American teens will be graduating from high school. There was a time when this meant many of them would go off to college, get a degree and start a career. But in recent years, for a variety of reasons, including a sluggish economy and the growing skills gap in the American workforce, many young people are heading back home to live in mom and dad’s basement after receiving that college degree.
That reality is reinforced by recent assessments of U.S. Census data by Pew Research showing that more than one-in-four adults between the ages of 25 and 34 had moved back with their parents at one time or another during the “Great Recession.”
A new survey from Junior Achievement USA and The Allstate Foundation shows that 25 percent of teens believe they will be age 25-27 before becoming financially independent from parents/guardians, up from 12 percent in 2011.
Generally speaking, teens are more optimistic about their futures, with a 20 percent increase in those saying they expect to be financially better off than their parents. But part of their financial security now comes from depending on parents longer.
It is interesting to see this shift in teens thinking they will remain financially dependent on parents, while building a better future for themselves.
Similarly to how you’ve encouraged and taught your children through other aspects of their lives, you also need to give them the boost to financial independence by talking to them about money. Thirty percent of teens think their parents don’t talk to them enough about money.
Teens say they are unsure about their ability to budget (23 percent), use credit cards (20 percent) or invest money (34 percent). You can teach them how to do each of these things, and if you’re feeling nervous, lean on Junior Achievement to provide the tools.
At Junior Achievement, we are committed to preparing students from kindergarten through high school to own their economic success. We understand that preparing our youth to be financially literate is more complex than teaching them to put their pennies in a piggy bank.
The Junior Achievement JA Economics for Success program, created in partnership with The Allstate Foundation, has helped more than 1.2 million students set personal goals about money and make wise financial choices, like renting an apartment post-graduation. In Rhode Island, 4,089 students have gone through the JA Economics for Success program over the last eight years.
Junior Achievement works closely with educators and with the business community to deliver our programs to more than 4.2 million U.S. youth annually. Locally, we served more than 10,500 students in the 2011-2012 school year in Rhode Island.
We know times have been tough, but now is the time to secure independent financial futures for yourselves and your children. Empower your children today. •
Lee Lewis is president of Junior Achievement of Rhode Island.