Generation Zero: The financial struggle of being young in America

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Key takeaways

  • North American youth are forced to work while studying to cover the costs of college, missing out on social life, studies, and sleep. Worryingly, 32% of those who study and work simultaneously experience mental health issues as a result.

  • This financial hardship often follows graduates into their professional lives with more than half expressing dissatisfaction with their current salaries.
  • Yet, Gen Z feels the education system has left them without the skills to improve their situation, with 72% stating they weren’t taught how to negotiate a salary and 70% admitting they don’t know how to manage their money.

You go off to university hoping to find yourself, improve your prospects, and increase your earning potential. Then you graduate. You have no experience of the adult world, a mountain of debt, and no idea what you’re supposed to do with your life.

A college education is one of the costliest purchases young people make, with the average student borrowing $29,000 to fund their studies. And yet, the system leaves them feeling short-changed when it comes to preparing for the future and dealing with the financial headaches that adulthood (and paying off all that debt) brings.

EduBurdie surveyed 2,000 young people from North America on their financial struggles before and after completing their education, and their feelings towards the education system. The result shows that, despite all that time spent studying, graduates are often left scratching their heads when it comes to money.

Finding time to study while coping with the financial pitfall of college

students work to support parents financially

For many, the financial challenges start long before they graduate. There’s not just the cost of the course to cover. There’s somewhere to live, something to eat (and for 22% of Gen Z, the need to provide financial support to their parents).

students who combine work and study experience mental health issues

In between the exams and essays, higher education is supposed to be a time for socialization and self-discovery. Yet, those forced to pay the bills during their college years often find that work gets in the way of living a normal student life. Some 50% say they felt they had to ‘sacrifice’ fun in order to work, while 16% put their dating lives on hold. And if they don’t have time to socialize, forget about picking up a book to study — 11% admit to skipping class to take on a shift.

Facing ridicule from their peers and suffering from a lack of sleep, it’s not uncommon for this burden to weigh heavily on America’s young population. For a third, the reward for their hard work is a combination of severe stress, anxiety, insomnia, and panic attacks.

The financial hardship doesn’t end at graduation

gen z feel unprepared to handle financial responsibilities

For many young people, passing from studenthood to adulthood doesn’t make life any easier. They leave education behind and find themselves struggling to find a suitable job, negotiate their salary, and balance the rising cost of living and impending student loan repayments — without the knowledge or experience to navigate the adult world. 

As they enter the job market, a third of young graduates find themselves questioning whether they’re really prepared to handle their newfound financial responsibilities.

young people are unsatisfied with their current salary

This lack of financial confidence really shows in the young population’s dissatisfaction with their current salaries. College promised to accelerate their climb up the corporate ladder and fast track their earning potential — and yet 56% feel they are underpaid for the work they put in.

young people feel they weren't taught the skills to negotiate their salary

So why don’t they show their value, present their case, and simply ask for more? Well, it seems all those textbooks are failing to teach America’s student population something crucial to their futures: The art of negotiation. Worryingly, 72% of young people don’t feel that their education has taught them how to secure a suitable salary. For women, the money talk is even more difficult, with 76% feeling negotiation skills were missing from the curriculum.

Discussing pay can be tough even for the most experienced of workers. For graduates, fresh out of college and severely lacking in negotiating skills, the battle in the boardroom is often lost before it even gets started — It’s really no wonder that graduate wages have been stagnant for years (or falling sharply when you factor in inflation).

70% feel the education system failed to teach them how to manage their money

Helping young people to secure the lucrative wages that college brochures promised isn’t the only place that education is failing its students. When it comes to teaching young people how to manage their money effectively, the system earns itself an ‘F’ according to 70% of respondents.

With wages falling short of expectations and graduates lacking the skills to manage the little money they do earn, it can take years for graduates to truly get to grips with the financial responsibilities of adulthood.

America’s education system is failing the grade in financial literacy

students think that financial literacy is the area they want to improve most

America’s young graduates feel that the education system fails to hit the mark in a number of areas — particularly teaching communication skills, critical resolution, and time management. However, it’s financial literacy that receives the lowest grade, with 47% feeling their education has left them lacking in the real world.

Handling the stresses of college and beginning life as a professional is difficult enough. To protect the well-being of its former students, the education system must find a way to ease the learning curve for young people when it comes to managing their finances.

Methodology: To create this study, researchers from EduBirdie surveyed 1,500 people from the US and 500 from Canada. Participants were invited to share their experiences at random with no focus on particular genders, ethnicities, or social backgrounds.

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