You might be thinking that since you are still in your youth, you have years to worry and learn about your budgeting, saving, and investing needs. However, not procrastinating in your youth can predetermine your life’s financial security and happiness. If you have already learned at home, or in school, or on this website about the miracle of compound interest, you know how important practicing delayed gratification for the greater financial goal is in your best interest. Below we offer some research data that shows some startling financial facts that have generally occurred to past generations--your parents and grandparents. Kid$Vest doesn’t want these same tragedies to happen to you.
As you read these financial facts you may, or may not, agree with my hypothesis that The Kid$Vest Project is an example of how you can change your habits and lives by including financial education and action steps into your daily routine. You may not also agree that long term economic success and reduction of the wealth gap can be a positive outcome of its implementation over time. Well, I sincerely hope that reading the information on this website and my book, The Kid$Vest Project, changes your mind, because you would be wrong! Or to be more politically correct, you are sorely mistaken. Here are the financial research tidbits that clearly show the disastrous effect of what poor financial knowledge and insufficient retirement planning have already done to America's work force and kids like yourself.
- The average American worker has $53,000 saved for retirement and over 50% of workers (75 million people), have saved nothing.
- The average college student graduates with $41,000 worth of school loans (debt) and $4,000 worth of credit card debt—you can double this if you go to grad school.
- A Schwab/Age Wave survey conducted with American kids grades the investing education they received from their parents at a C-, stating, “They didn’t know enough about investing to teach them anything.”
- The JumpStart Coalition found that less than 50% of high school seniors passed a basic financial literacy test, and just 62% of college seniors passed the same test. These rates translate into poor money management habits in adulthood.
- More than 70% of Americans know they cannot retire, or lack the money to do so, and 35% of Americans over age 65 rely entirely on social security payments to live on.
- About 19% of workers have been compelled to take money from their retirement savings during the last year to cover urgent financial needs.
- The US middle class is stagnating: wage growth for the past thirty years is flat, and yet we continue to spend and use debt to maintain a standard of living we feel we deserve.
- Of the $1.3 trillion dollars in current student loan debt, 43%, or roughly 22 million Americans, with federal student loans are not making payments, or are in default.
- The US fiscal budget deficit is huge (roughly $20 trillion) and cuts or changes will likely be made in Social Security, Medicare, and Medicaid, as well as other social services.
I don’t know about you, but this devastating information blows me away! In my view, the lack of financial literacy training and investment action for most youth ranks right up there with terrorism and cybersecurity as threats to the American way of life. This youth financial neglect is detrimental to you and future generations because it rips the soul out of those of you who are still trying to achieve the American Dream.