A recent study from the University of Arizona found that most college graduates are relying on their family for financial assistance, including almost half of those surveyed who have full-time jobs.
The study, “Arizona Pathways to Life Success for University Students,” or “APLUS,” is an ongoing longitudinal study that surveys more than 1,000 young adults as they transition from college to the workforce over the past six years.
“I don’t think what we’re finding is that unusual,” says Joyce Serido, the study’s principal investigator and an assistant research professor at the University of Arizona. “I think you’ll hear in the popular press a lot about young adults who are not able to make it on their own.”
The study found that student debt was a major roadblock for these students, Serido says. Those with debt had less financial satisfaction and felt reliant on their parents, even if they had full-time employment.
“What we’re saying is that carrying any debt seems to be a burden that really does erode your quality of life,” Serido says. “Anybody that’s carrying debt — whether young, adult, in retirement, it doesn’t matter — it’s like weight on your shoulder.”
While college graduates’ struggles aren’t surprising to Serido, she says some statistics surprised her team. Some participants were apparently so affected by debt or other financial hurdles that they weren’t interested in traditional life goals, including marriage (28 percent had no interest), children (27 percent) and purchasing a house (19 percent).
While Serido says she isn’t sure why young people had less interest in those familiar milestones, she wonders whether it is simply because those goals are so far out of their reach.
“If you think about the last time we had a recession of the size of the earthquake that hit here, it was the Great Depression,” Serido says. “A lot of people who came of age during the Depression, their attitudes and behaviors were changed for their whole lives.”
In the meantime, she thinks their current hesitance is understandable and even commendable.
“From my dealings with these young adults in particular, I think they’re actually very resilient,” Serido says.
The study found that students who were financially educated — from understanding personal finance to managing their resources such as cars or their own homes — ended up faring better than those who weren’t educated. Serido says the key is educating youth about finances, but oftentimes parents and teachers don’t know enough to properly educate children and teenagers.
That’s where school programs and conferences can help, says Robin Wise, president and CEO of the Rocky Mountain division of Junior Achievement. That organization provides in-school and after-school training aimed to help youth be prepared for real-world financial situations.
Its simulation “JA Finance Park” teaches eighth-graders budgeting and finance skills such as purchasing transportation, food, utilities, health care, investments and banking — and budgeting for philanthropy. In general, it helps the students understand the concept of not spending beyond their means and understanding the difference between a need and a want, she says.
Sometimes Junior Achievement delves into more complex aspects of finances, like teaching teens how to diversify their investment portfolio. These are “sophisticated concepts,” but ones that young teenagers can grasp, Wise says.
It’s important just to at least start the dialogue with youth, Wise says.
“You can never start too early,” she said. “Parents are more willing to talk to their kids about sex than they are about money. They don’t talk about the dangers of debt.”
Jordan Gonzalez: 303-954-1395, jgonzalez@denverpost.com
