Recession Lessons From Gen Y

I am excited to write this post. You see, you always read articles about self indulgent  Gen Y’s (20 year olds) in fact Gail has a whole show about it called Princess though in the show’s defense they are not discriminating on age. Any ways I have felt for a while that I can’t be the only 20-something person in North America who is taking their money seriously.  I know that the people in the PF world that are my age are of course. But we can’t be the only ones. And it seams that my assumptions were right!  An article that came out in U.S. News & World Report showed that “A new survey from TD Ameritrade found that one in four 20-somethings funnel money into not one, but two different types of retirement accounts, a 401(k) or 403(b) as well as an IRA.” I know your saying but that’s American how does it apply to Canada? Well the truthfully it doesn’t but it’s an indication that all the nay sayers about the Gen Y’s money management skills haven’t got all the facts.

 The article goes on to talk about the importance the recession has had on my generation. I believe that history recycles itself in 3-4 generations. Let me explain Generation 1) suffered though WWI then the Great Depression and again WWII. Realising the importance of safety nets and saving, when the time changed this generation put in to the place the largest safety nets creating our cradle to grave society.  Generation 2) benefited from both good jobs, social safety nets and the experiences of their parents. Generation 3) has not so good/stable jobs but safely nets that are becoming excessively costly and cumbersome to the society. As this point generation 3 is to far away from ‘remembering’ or ‘hearing stories’ about how difficult it once was and start to question the reason for all the expressive programs. By the time that Generation 4 comes around things are tight again. And watching money is no longer an option but a reality.

I think my Generation has seen the deteriorating of social and ‘the norm’ and are pessimistic about whether any kind of social service or program will be around when they hit old age. I know I am. Also the fact that nothing truly guarantied anymore means that we have to take matters into out own hands.  “Gen Y has accepted the reality of the past few years, and rather than being discouraged, they’ve changed their behaviours and are using what they’ve witness to their advantage,” says Nicole Sherrod, managing director at TD Ameritrade. “This is something that older generations could benefit from,” she adds.

The recession has been a great eye opener to many of my generation and the stats are more reflecting this “One in three respondents told Scottrade that they've learned more about how the economy works because of the recession and a similar percentage said they've become more familiar with their own personal finance situation. Those are higher percentages than any other generation.”

There are the links to the articles that I quoted. I strongly encourage you to read them they are very interesting!!

http://money.usnews.com/money/blogs/alpha-consumer/2011/01/20/recession-lessons-from-gen-y
http://ca.finance.yahoo.com/news/gen-y-saving-more-retirement-213303344.html