The next generation of young adults gets it: College is going to be expensive. Saving money is important. The job market isn't very promising.
Much of Generation Z, or those roughly ages 13 to 22, show a high understanding of those financial and economical truths in a survey out Wednesday on the financial habits and concerns of Gen Z and their parents by TD Ameritrade.
Both Gen Z and their parents listed jobs and unemployment first when asked to identify their biggest concerns about the economy, mentioned by roughly a quarter of both groups.
"They are doing a nice job understanding the challenges they may face," says Carrie Braxdale, managing director of investor services at TD Ameritrade, adding, "It was impressive and surprising to see how well aware they are around the importance of money."
When asked about specific topics, 39% of Gen Z said they are concerned about affording college and having student loans, though the top concern was having their identity stolen, indicated by 40% of Gen Z respondents.
Caleb Hawkes, 17, says going to college has always been important to him, but he is worried about paying for it. The high school senior says almost all his income from jobs as a lifeguard and mowing lawns at home in Madison, S.D., goes into his savings account, but that even with help from his parents, he knows "a student loan is almost inevitable."
But not all of Gen Z has Hawkes' same awareness. Even though they indicated being concerned about student loans, when asked how they currently pay or expect to pay for college, only 25% of Gen Z said they rely on or will need assistance from student loans, the survey shows.
In reality, two-thirds of college seniors in 2010, the most recent year for which there are data, graduated with student loan debt, according to the Project on Student Debt.
"They are very optimistic," Braxdale says of Gen Z. "A lot of this could be a bit influenced by the span of time between where they are now and when (college) would become a reality for them."
The most concerning survey results were Gen Z's credit card habits, Braxdale says. While Gen Z kids are good savers — more than half have a savings account and 76% say it's important to save money at this stage in their life — there isn't the "same diligence" when it comes to credit cards, she says.
A little more than a quarter of Gen Z indicated having a credit card, but more than half of those carry a balance on the card for at least six months.