Americans are feeling pretty good these days about their financial futures, and millennials in particular are the most optimistic generation group when it comes to their ability to afford to buy a home in the next few years, according to a recent survey conducted by mortgage lender Wells Fargo.
Conducted with global market research company Ipsos as part of its annual support of the American Bankers Association’s (ABA) “Get Smart About Credit” campaign, the survey found that young adults ages 18 to 35 feel the most optimistic about their ability to purchase their first home — despite widespread media reports that millennials are underemployed or swimming in student loan debt. That’s a stark contrast to results from last year’s survey, when different generations were more aligned in their sentiments.
According to the survey, which polled nearly 2,000 Americans ages 18 to 65 about their attitudes and perceptions of the American economy, finances and understanding of credit, 28 percent of millennials see their financial situation in favorable terms, compared to 24 percent of the general population. About a third of millennials said they expect to buy a new home in the next three years, while only 19 percent of other generation members said they plan to buy a home within that timeframe. And of any generational group, millennials are most likely to be in the process of refinancing their mortgages or buying a new home, investment property or vacation home for themselves, according to the survey.
Looking to the future, 66 percent of millennials surveyed said they feel their financial situation will improve, while only 48 percent of the general population expressed that optimism.
Overall, 82 percent of all respondents said their financial situation today is “stable to strong,” and 90 percent said they expect their finances will either be the same or better a year from today.
However, the survey’s results provided evidence that more financial education still is needed. Although Wells Fargo said the survey reflects consumers’ desire to learn more about how credit works, 52 percent of respondents said borrowing money makes them uncomfortable, and less than half of them grade themselves “C,” “D” or “F” on their understanding of personal finances and how credit and loan products work.
“The Get Smart About Credit” campaign encourages bankers to educate young people about the importance of using credit and debt responsibly. Wells Fargo hopes to use the campaign to reach 60,000 by volunteering in classrooms and teaching credit lessons across the country.