Benefits October 25, 2006

Study Paints Bleak Financial Picture for Young Adults

October 25, 2006 (PLANSPONSOR.com) - A study from the American Institute of Certified Public Accountants (AICPA) claims Americans age 25 - 34 face rough financial times due to their current spending habits.
Reported by

According to a press release on the study, the number of people in this age group maintaining an interest-bearing account or other savings instrument declined from 65% in 1985 to 55% in 2004. Ownership of a savings account with a bank fell from 61% to 47% between 1985 and 2004, the study found.

For more stories like this, sign up for the PLANSPONSOR NEWSDash daily newsletter.

In addition to declining savings, the level of debt is rising among 25 to 34-year-old Americans. According to the press release, the study found the average level of debt for this age group was $3,118 in 1985 and climbed to $4,733 by 2004.

The median net worth for this group has fallen dramatically, according to study results. In 1985, it was $6,788, and by 2004 it was $3,746. As a percentage of income, net worth for 25 – 34 year olds went from 99% of income in 1985 to 92% of income in 2004.

The study was conducted by Christopher Thornberg and Jon Haveman, economists with Beacon Economics in Los Angeles, on behalf of Feed the Pig ( www.FeedthePig.org ), a national public-service campaign sponsored by the AICPA and the Ad Council.

«