Not only do teens think they'll be financially dependent on their parents for longer, but less think they'll be as well-off or better financially than their parents.
Parents may be helping their children financially for longer than expected, according to a survey on teens and finances. And while less have reported learning money management in school, they’ve been mirroring their parents’ behaviors.
The 2012 Junior Achievement Teens and Personal Finance survey indicates that teens are expecting that they’ll be completely financially independent later. In 2011 44% said they’d be independent by the age of 20, but this year only 18% believe so. Meanwhile the number that expects to be independent by 25 to 27 almost doubled to 23% in 2012.
A little more than half of respondents think they’ll be as financially well-off or better than their parents. And while 56% isn’t bad, that’s a significant drop from 2011’s 89%. There is a lot of uncertainty, as 30% said they aren’t sure.
And while teenagers said that money management is important, they aren’t doing it. There was a large increase of teens who reported not budgeting or managing their money, increasing from 10% in 2011 to 34% in 2012.
This sort of change in behavior is being learned from parents. When you don’t save as much, your children don’t bother to save as much. So because there was a significant drop in parents saving money during the recession, teens mirrored that behavior. In 2011, 59% of respondents said parents were saving compared to only 21% in 2012. As a result, only 56% of teens plan to save some of their income, down from 89% in 2011.
Parents are a clear role model for money management because teens reported they aren’t getting as much information on it in school as they used to. While 58% reported learning to manage money in school in 2011, only 25% reported so in 2012.