1. Preparing for Their Future: A Look at the Financial State of Gen X and Gen Y Sponsored by The American Savings Education Council and AARP (on behalf of Divided We Fail) Conducted by Mathew Greenwald & Associates

2. 1 Preparing for Their Future A Look at the Financial State of Gen X and Gen Y March 2008 Copyright © 2008 American Savings Education Council and AARP Reprinting with Permission This report is jointly owned by the American Savings and Education Council (ASEC) and AARP. AARP engaged in this research on behalf of Divided We Fail. American Savings Education Council (ASEC) 1100 13th Street, NW, Suite 878 Washington, DC 20005 www.choosetosave.org American Savings Education Council (ASEC), is a program of the Employee Benefit Research Institute (EBRI) Education and Research Fund, a 501 (c) (3) non-profit organization (www.ebri.org and www.choosetosave.org). The ASEC mission: To make saving and retirement planning a priority for all Americans. ASEC is a convener and connector that brings together public- and private- sector partners to share information on best practices and to collaborate on financial security initiatives. For more information visit www.choosetosave.org/asecwww.ebri.orgwww.choosetosave.org AARP 601 E Street, NW Washington, DC 20049 http://www.aarp.org AARP is a nonprofit, nonpartisan membership organization that helps people 50+ have independence, choice and control in ways that are beneficial and affordable to them and society as a whole. AARP does not endorse candidates for public office or make contributions to either political campaigns or candidates. We produce AARP The Magazine, published bimonthly; AARP Bulletin, our monthly newspaper; AARP Segunda Juventud, our bimonthly magazine in Spanish and English; NRTA Live & Learn, our quarterly newsletter for 50+ educators; and our website, http://www.aarp.org. AARP Foundation is an affiliated charity that provides security, protection, and empowerment to older persons in need with support from thousands of volunteers, donors, and sponsors. We have staffed offices in all 50 states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands. Mathew Greenwald & Associates of Washington, D.C. conducted the survey on behalf of the American Savings Education Council (ASEC) and Divided We Fail. Subject matter expertise was provided by Divided We Fail and the Employee Benefits Research Institute. All media inquiries about this report should be direct to EBRI’s John MacDonald at (202) 775-6349 or AARP’s Jim Dau or Alejandra Owens at (202) 434-2560. All other inquiries should be directed to AARP’s Colette Thayer at (202) 434-6294.

3. 2 Preparing for Their Future A Look at the Financial State of Gen X and Gen Y Divided We Fail Divided We Fail, launched nationally in January 2007, has worked to engage the American people, elected officials and the business community to find broad-based, bi-partisan solutions to the most compelling domestic issues facing the nation: health care and the long- term financial security of Americans. AARP, Business Roundtable, Service Employees Union (SEIU), and National Federation of Independent Business (NFIB) are engaging the American people, businesses, non-profit organizations, and elected officials in finding bi- partisan solutions to ensure affordable, quality health care and long-term financial security – for all of us. More information about Divided We Fail efforts can be found at www.dividedwefail.org.www.dividedwefail.org AARP AARP is a nonprofit, nonpartisan membership organization that helps people 50+ have independence, choice and control in ways that are beneficial and affordable to them and society as a whole. AARP does not endorse candidates for public office or make contributions to either political campaigns or candidates. We produce AARP The Magazine, published bimonthly; AARP Bulletin, our monthly newspaper; AARP Segunda Juventud, our bimonthly magazine in Spanish and English; NRTA Live & Learn, our quarterly newsletter for 50+ educators; and our website, http://www.aarp.org. AARP Foundation is an affiliated charity that provides security, protection, and empowerment to older persons in need with support from thousands of volunteers, donors, and sponsors. We have staffed offices in all 50 states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands. Business Roundtable Business Roundtable (www.businessroundtable.org) is an association of chief executive officers of leading U.S. companies with $4.5 trillion in annual revenues and more than 10 million employees. Member companies comprise nearly a third of the total value of the U.S. stock markets and represent over 40 percent of all corporate income taxes paid. Collectively, they returned $112 billion in dividends to shareholders and the economy in 2005. Roundtable companies give more than $7 billion a year in combined charitable contributions, representing nearly 60 percent of total corporate giving. They are technology innovation leaders, with $90 billion in annual research and development spending - nearly half of the total private R&D spending in the U.S.www.businessroundtable.org SEIU With 1.8 million members, SEIU (www.seiu.org) is the fastest-growing union in North America. Focused on uniting workers in three sectors to improve their lives and the services they provide, SEIU is the largest health care union, including hospitals, nursing homes, and home care; the largest property services union, including building cleaning and security; and the second largest public employee union.www.seiu.org NFIB NFIB is the nation’s leading small-business advocacy association, with offices in Washington, D.C. and all 50 state capitals. Founded in 1943 as a nonprofit, nonpartisan organization, NFIB gives small- and independent-business owners a voice in shaping the public policy issues that affect their business. NFIB’s powerful network of grassroots activists send their views directly to state and federal lawmakers through our unique member-only ballot, thus playing a critical role in supporting America’s free enterprise system. NFIB’s mission is to promote and protect the right of our members to own, operate and grow their businesses. More information about NFIB is available online at www.NFIB.com.www.NFIB.com.

4. 3 On behalf of the American Savings Education Council (ASEC) and Divided We Fail, Mathew Greenwald & Associates conducted an online survey with young Americans ages 19 to 39 about their financial attitudes and behaviors. In total, 1,752 respondents completed the online study. On average, the survey took about 25 minutes to complete. The data was weighted by age, gender, race and education. Unweighted n sizes are reported throughout. Throughout the following report, Gen Y includes those ages 19 to 27 and Gen X is comprised of those ages 28 to 39. Introduction & Methodology

5. 4 Profile of Younger People and Households

6. 5 Large majorities of young Americans describe themselves as hard-working and family-oriented. Nearly as many say they are optimistic. How well do the following phrases describe you? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Hard-working Optimistic Disciplined Family-oriented Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

7. 6 Gen Yers characterize themselves as more technologically savvy than do Gen Xers. How well do the following phrases describe you? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Technologically savvy Expensive taste Carefree Charitable Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

8. 7 Half of young adults with a spouse or partner say financial decisions are made in total partnership. Which of the following best describes your role in how financial decisions are made in your household? (Total n=991; Gen Y n=236; Gen X n=755) Among those who are married or living with a partner You are the sole decision-maker You are the primary decision- maker, but your spouse/ partner provides input You and your spouse/partner make decisions in total partnership Your spouse/partner is the primary decision-maker, but you provide input Your spouse/partner is the sole decision-maker <.5% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

9. 8 Financial Independence

10. 9 Interestingly, more Gen Yers consider themselves to be “financially independent.” Do you consider yourself to be “financially independent”? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Percent saying yes Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

11. 10 Young Americans’ perception of being financially independent increases with income. Do you consider yourself to be “financially independent”? (Total n=1,752; <$30K n=474; $30K- 49K n=405; $50K-79K n=443; $80K+ n=352) Percent saying yes Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are either married or live with a partner. Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

12. 11 Despite their purported independence, Gen Yers are nearly twice as likely to receive financial support from family or friends. In the past year, have you received any financial support from family or friends? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Percent saying yes Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

13. 12 Receipt of financial support from family or friends is relatively consistent among those in different racial and ethnic groups. In the past year, have you received any financial support from family or friends? (Total n=1,752; Caucasian n=1,227; African-American n=150; Hispanic n=151; Asian/Pac. Islander n=154) Percent saying yes Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

14. 13 Similarly, younger Gen Yers report receiving more financial assistance from government programs than Gen Xers. In the past year, have you received any financial assistance from government programs? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Percent yes Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

15. 14 Likelihood of receiving financial assistance from the government is consistent across racial and ethnic groups. In the past year, have you received any financial assistance from government programs? (Total n=1,752; Caucasian n=1,227; African-American n=150; Hispanic n=151; Asian/Pac. Islander n=154) Percent saying yes Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

16. 15 Financial support from family is usually less than $2,500 per year; those who receive government assistance report somewhat higher amounts. Over the past year, approximately how much financial support did you receive from family or friends? (Total n=545; Gen Y n=277; Gen X n=268) Among those who have received financial support from family or friends Over the past year, approximately how much financial support did you receive from government programs? (Total n=267; Gen Y n=129; Gen X n=138) Among those who have received financial assistance from government programs Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

17. 16 Financial independence was achieved at approximately 20 years old for members of these younger generations. At what age did you become financially independent? (Total n=1,024; Gen Y n=375; Gen X n=649) Among financially independent individuals Median Age At Start of “Financial Independence” Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

18. 17 The most commonly cited milestone that marked their financial independence was either graduation or landing their first job. What, if any, event or life stage would you say marked the start of your financial independence? (Total n=1,024; Gen Y n=375; Gen X n=649) Among financially independent individuals When you got your first job High school graduation Start of college College graduation Top 4 Responses Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

19. 18 For a few, their wedding date marked the start of their financial independence. What, if any, event or life stage would you say marked the start of your financial independence? (Total n=1,024; Gen Y n=375; Gen X n=649) Among financially independent individuals Getting Married (if not already) Something else Start of graduate school Graduate school graduation Top 5-8 Responses Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

20. 19 College graduation marks the beginning of financial independence for those with at least a bachelor’s degree, with a similar trend among high school grads. What, if any, event or life stage would you say marked the start of your financial independence? (Total n=1,024; High school or less n=129; Some college n=373; Bachelor’s n=369; Master’s or more n=153) Among financially independent individuals When you got your first job High school graduation Start of college College graduation Top 4 Responses Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

21. 20 In keeping, those with a master’s degree are more likely to say their financial independence coincided with the completion of graduate school. What, if any, event or life stage would you say marked the start of your financial independence? (Total n=1,024; High school or less n=129; Some college n=373; Bachelor’s n=369; Master’s or more n=153) Among financially independent individuals Getting marriedGraduate school graduation Start of graduate school Something else Top 5-8 Responses Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

22. 21 Current Financial Situations

23. 22 Half of young adults are satisfied with their current financial situation, yet only 9% are very satisfied. How satisfied would you say you are with your current financial situation? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Net Satisfied: 53% Net Not Satisfied: 47% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

24. 23 African-Americans express less satisfaction with their current financial situations than others. How satisfied would you say you are with your current financial situation? (Total n=1,752; Caucasian n=1,227; African-American n=150; Hispanic n=151; Asian/Pac. Islander n=154) Net Satisfied: 53% Net Not Satisfied: 47% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

25. 24 Predictably, satisfaction with one’s current financial state improves as income increases. Still, few say they are highly satisfied. How satisfied would you say you are with your current financial situation? (Total n=1,752; <$30K n=474; $30K-$49K n=405; $50K-$79K n=443; $80K+ n=352) Net Satisfied: 53% Net Not Satisfied: 47% Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are either married or live with a partner. Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

26. 25 Few feel very financially secure, with Gen Xers significantly more likely to say they feel “not at all secure.” Overall, how “financially secure” do you feel you are right now? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Net Secure: 49% Net Not Secure: 51% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

27. 26 As with satisfaction with their current circumstances, young adults with higher incomes report higher degrees of financial security. Overall, how “financially secure” do you feel you are right now? (Total n=1,752; <$30K n=474; $30K-49K n=405; $50K-$79K n=443; $80K+ n=352) Net Secure: 49% Net Not Secure: 51% Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are either married or live with a partner. Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

28. 27 The vast majority feel they should be better prepared for a rainy day. At the same time, two-thirds say they can count on family and friends if times get hard. Thinking about your current financial situation, to what extent do you agree or disagree with the following statement? (Total n=1,752; Gen Y n=613; Gen X n=1,139) You feel you should be more prepared for a “rainy day” You can rely on friends and family to help you financially when you are in a tough situation You worry about your financial future, perhaps to the detriment of enjoying today Making decisions about money makes you feel anxious You struggle to make ends meet Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

29. 28 Young Americans indicate that they have financial goals for themselves. Thinking about your current financial situation, to what extent do you agree or disagree with the following statement? (Total n=1,752; Gen Y n=613; Gen X n=1,139) You appreciate the material goods you have, even if it’s not a lot You have financial goals for yourself You are proud of how you have lived your life financially so far Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

30. 29 Relatively few say they feel taken advantage of by the system, Gen Yers slightly more so than Gen Xers. Thinking about your current financial situation, to what extent do you agree or disagree with the following statement? (Total n=1,752; Gen Y n=613; Gen X n=1,139) You sometimes offer financial advice to others You feel taken advantage of by “the system” Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

31. 30 Two in ten include affording basic needs and the ability to pay bills in their definition of financial security, with enough leftover to save for a rainy day. How would you define “financial security”? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Multiple responses accepted Not living paycheck to paycheck / Able to afford basic needs Not having to worry about finances Live comfortably Able to save / Have emergency or rainy day fund Able to deal with the unexpected or hard times Top 6 Reported Not having debt Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

32. 31 Only one in twenty associate financial security with being able to travel and engage in other leisure activities. How would you define “financial security”? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Multiple responses accepted Able to provide for family / Money for children’s education Able to retire / Maintain current lifestyle in retirement Can afford travel/entertainment/ leisure/fun Have money/enough money / dollar amount (general) Top 7-12 Reported Don’t know / Refused Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

33. 32 Savings and Debt

34. 33 Since six in ten say they struggle to make ends meet, it is not surprising that being able to pay bills tops the list of financial concerns. When it comes to your finances, what is your biggest fear or concern? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Multiple responses accepted Paying bills / Making ends meet Having enough money to support self/family Lack of savings / Having enough for an emergency / Future Unemployment / Job loss / Career Being able to retire / Afford retirement Top 5 Reported Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

35. 34 Half of young adults say they stick to a monthly budget. Far fewer have a written financial plan or a will. Do you currently…? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Percent saying yes Stick to a monthly budget Have a will Have a living will (also known as a health care directive) Have a formal, written financial plan Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

36. 35 Married young adults and those living with a partner are more likely to have a financial plan, a will, and a living will. Do you currently…? (Total n=1,752; Married/Living w/ partner n=991; Unmarried/No partner n=761) Percent saying yes Stick to a monthly budget Have a will Have a living will (also known as a health care directive) Have a formal, written financial plan Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

37. 36 Just half of members of these younger generations report that they save on a regular basis. Do you currently save money on a regular basis? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

38. 37 Not surprisingly, likelihood of saving regularly increases with income. Do you currently save money on a regular basis? (Total n=1,752; <$30K n=474; $30K- $49K n=405; $50K-$79K n=443; $80K+ n=352) Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are either married or live with a partner. Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

39. 38 Fewer have savings designated as an emergency fund for unanticipated expenses. Do you have an “emergency savings” fund or money that you keep in reserve for unexpected expenses, like a big car repair, or in case you were to stop receiving income for any reason? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

40. 39 A sizable proportion of employed young Americans say they could not live off their savings for more than one month. If you were to stop receiving income today from work or other sources, how long would you be able to live on your savings alone? (Total n=1,598; Gen Y n=534; Gen X n=1,064) Among employed individuals Less than one month 6 months to less than 1 year 3 to less than 6 months 1 to less than 3 months 1 year or longer Not sure Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

41. 40 Eight out of ten young people do not feel they are saving enough money for the future. Given your current income and living situation, do you feel you are savings enough money for the future? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

42. 41 Those with an income of $80,000 or more are four times more likely than those who earn less than $30,000 to feel they are saving enough money. Given your current income and living situation, do you feel you are savings enough money for the future? (Total n=1,752; <$30K n=474; $30K-$49K n=405; $50K-$79K n=443; $80K+ n=352) Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are either married or live with a partner. Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

43. 42 Large shares report that they have credit card and car loan debt. Gen Xers are more apt than Gen Yers to have most kinds of debt. Do you have any of the following types of debt? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Percent saying yes Credit card Medical Mortgage Car loan Student loan Other Home equity loan Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

44. 43 Three in ten young adults are $20,000 or more in debt, excluding mortgages. Approximately, how much non-mortgage debt do you currently have? (Total n=1,496; Gen Y n=503; Gen X n=993) Among those who have non-mortgage debt Less than $1,000 $10,000 to $19,999 $2,500 to $4,999 $1,000 to $2,499 $5,000 to $9,999 $50,000 or more $20,000 to $49,999 Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

45. 44 Debt levels seem especially high when considering that the majority of these young people have less than $10,000 in total savings and investments. In total, about how much money would you say you (and your spouse or partner) currently have in savings and investments, not including the value of your primary residence? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Less than $10,000 $50,000 to $99,999 $20,000 to $29,999 $10,000 to $19,999 $30,000 to $49,999 $100,000 or more Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

46. 45 Still, just one-third of young adults identify their debt as a major problem. Thinking about your current financial situation, how would you describe your level of debt? (Total n=1,587; Gen Y n=520; Gen X n=1,067) Among those who have debt Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

47. 46 Those with mortgage debt only are far less likely to see their debt as a problem. Thinking about your current financial situation, how would you describe your level of debt? (Total n=1,587; Non-mortgage debt n=1,513; Mortgage debt only n=72) Among those who have debt Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

48. 47 It follows, then, that most report being behind schedule regarding saving. For the following, do you think you are behind schedule, ahead of schedule, or on track compared to others your age? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Saving for an emergency or having savings in general Saving for retirement Debt Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

49. 48 By comparison, roughly half feel they are “on track” when it comes to their family lives, careers and their housing situations. For the following, do you think you are behind schedule, ahead of schedule, or on track compared to others your age? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Housing Family life Career Education Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

50. 49 Financial Goals

51. 50 Career advancement and retirement savings are priorities for most. Gen X is more focused on retirement savings. Gen Yers focus more on career. Thinking about the next ten years, which of the following are goals or priorities for you? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Multiple responses accepted Putting money away for retirement Minimizing stress in your life Paying off debt Advancing your career or earning more money Buying a home or making major improvements to your home Top 5 Reported Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

52. 51 Paying bills on time and focusing on health are also priorities. Thinking about the next ten years, which of the following are goals or priorities for you? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Multiple responses accepted Paying basic bills in full and on time Preparing for a child’s education Doing more leisure travel Focusing on your health Purchasing a car Top 6-10 Reported Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

53. 52 Over four in ten hope to obtain a higher degree, and a similar share would like to be more spiritual. Thinking about the next ten years, which of the following are goals or priorities for you? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Multiple responses accepted Living a more spiritual life Getting married (if not currently) Receiving a higher education or degree for yourself Having children or having more children Starting a business / Grow an existing business Top 11-15 Reported <.5% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

54. 53 Career advancement and earning more is most important. Reducing debt closely follows as the most important goal of young adults. Thinking about the next ten years, which of the following would you say is the most important goal or priority for you? (Total n=1,741; Gen Y n=609; Gen X n=1,132) Among those who mention goals or priorities Paying off debt Advancing your career or earning more money Buying a home or making major improvements to your home Living a more spiritual life Receiving a higher education or degree for yourself Top 5 Reported Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

55. 54 Saving for retirement drops significantly lower on the list when asked which goal is most important. Thinking about the next ten years, which of the following would you say is the most important goal or priority for you? (Total n=1,741; Gen Y n=609; Gen X n=1,132) Among those who mention goals or priorities Paying basic bills in full and on time Preparing for a child’s education Focusing on your health Getting married (if not currently) Putting money away for retirement Top 6-10 Reported Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

56. 55 Although three-quarters of young adults identify minimizing stress as a goal, it falls low on the list of most important priorities. Thinking about the next ten years, which of the following would you say is the most important goal or priority for you? (Total n=1,741; Gen Y n=609; Gen X n=1,132) Among those who mention goals or priorities Top 11-15 Reported Having children or having more children Start a business / Grow an existing business Minimizing stress in your life Purchasing a car Doing more leisure travel <.5% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

57. 56 Younger Americans express confidence that they will achieve their most important goals in the near future. How confident are you that you will be able to meet your most important goals in the next ten years? (Total n=1,741; Gen Y n=609; Gen X n=1,132) Among those who have goals or priorities for the next ten years Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

58. 57 Generational Differences

59. 58 Young adults most often cite increased cost of living and retirement issues as the biggest financial difference between the generations. What do you think is the most significant financial difference between your generation and your parents’ generation? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Top 6 Reported Cost of living / Inflation Debt / Credit cards Spend more now / Don’t save Retirement/ No pensions/ No Social Security/ Medicare Parents were smarter financially/ Saved sooner/ Disciplined spenders Work environment/ Work harder now/ Change jobs more often Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

60. 59 Others think young people spend more and save less than their parents did, even though a few feel their incomes are higher and they have more choices. What do you think is the most significant financial difference between your generation and your parents’ generation? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Multiple responses accepted Top 7-11 Reported More investment options now Economy/ Recession We make more money Government policy/spending/ Taxes No rise in salary Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

61. 60 Buying a home and finding work are seen as more difficult for many of today’s younger Americans, although obtaining an education is deemed easier. To the best of your knowledge, do you think it is easier or harder for people in your generation to do the following than it was for your parents’ generation? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Getting an education Buying a first home Finding good employment Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

62. 61 Moreover, supporting a family is considered a harder task, and many young adults view saving money for the long term as harder now. To the best of your knowledge, do you think it is easier or harder for people in your generation to do the following than it was for your parents’ generation? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Saving for a child’s college education Saving money for the long term Supporting a family Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

63. 62 Eight in ten anticipate having the same amount of money or more when they reach their parents’ age. Gen Xers are more likely to say they will have less. Do you expect that by the time you are your parents’ age you will have accumulated more money than your parents, less money, or about the same amount of money as your parents? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

64. 63 Young people with higher incomes are more apt to feel they will eventually accumulate more money than their parents. Do you expect that by the time you are your parents’ age you will have accumulated more money than your parents, less money, or about the same amount of money as your parents? (Total n=1,752; <$30K n=474; $30K-$49K n=405; $50K-$79K n=443; $80K+ n=352) Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are either married or live with a partner. Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

65. 64 African-Americans and Hispanics are especially likely to foresee having more money than their parents. Do you expect that by the time you are your parents’ age you will have accumulated more money than your parents, less money, or about the same amount of money as your parents? (Total n=1,752; Caucasian n=1,227; African-American n=150; Hispanic n=151; Asian/Pac. Islander n=154) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

66. 65 Most of these young Americans report that they come from middle or lower-middle class upbringings. When you were growing up, how would you describe your family’s lifestyle? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Upper class Middle class Upper middle class Lower middle class Lower class Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

67. 66 Many still consider themselves part of the middle class. Thinking about your current lifestyle, do you consider it to be…? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Upper class Middle class Upper middle class Lower middle class Lower class Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

68. 67 Still nearly one-quarter indicate that they have experienced some upward mobility. Class change (Total n=1,752; Gen Y n=613; Gen X n=1,139) Class improved Class remained the same Class declined Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

69. 68 Views toward the Workplace and Benefits

70. 69 Similar shares (about half) believe that employers have employees’ best interest at heart and that people their age feel loyal to their employers. To what extent to you agree or disagree with the following statements? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Employers generally have their employees’ best interest at heart People your age feel loyal to their employers Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

71. 70 Health insurance is clearly viewed as a critical benefit for employers to offer, while wellness programs are seen as less essential. How important is it that your employer…? (Total n=1,598; Gen Y n=534; Gen X n=1,064) Among employed individuals Offers a wellness program Provides health insurance Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

72. 71 Retirement plans and company matches are also seen as very important benefits, with Gen Xers even more likely to stress their importance. How important is it that your employer…? (Total n=1,598; Gen Y n=534; Gen X n=1,064) Among employed individuals Matches or contributes money to a retirement savings plan in addition to what you save Offers education and/or advice on how to save for retirement Provides a retirement savings plan Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

73. 72 When asked which benefit is most critical, health insurance is by far seen as the most important benefit; retirement plans are second. Which of these is most important? (Total n=1,598; Gen Y n=534; Gen X n=1,064) Among employed individuals Provides health insurance Offers education and/or advice on how to save for retirement Provides a retirement savings plan Matches or contributes money to a retirement savings plan in addition to what you save Offers a wellness program Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

74. 73 Offers education and/or advice on how to save for retirement Which of these is most important? (Total n=1,598; Caucasian n=1,166; African-American n=123; Hispanic n=126; Asian/Pac. Islander n=118) Among employed individuals African-Americans and Asian/Pacific Islanders place slightly less emphasis on health insurance as a workplace benefit. Provides health insurance Provides a retirement savings plan Matches or contributes money to a retirement savings plan Offers a wellness program ** * Less than 0.5% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

75. 74 Which of these is most important? (Total n=1,598; <$30K n=392; $30K-$49K n=376; $50K-$79K n=421; $80K+ n=343) Among employed individuals Individuals who earn at least $80,000 are more inclined than those who earn less to prefer that their employer provides a retirement savings plan. Provides health insurance Offers education and/or advice on how to save for retirement Provides a retirement savings plan Matches or contributes money to a retirement savings plan Offers a wellness program * Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are either married or live with a partner. Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

76. 75 More than half of young adults receive health insurance through their or their spouse’s employer. Still, one-quarter indicate that they are not insured. Are you currently covered by health insurance? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

77. 76 Likelihood of being insured by an employer increases with income. Are you currently covered by health insurance? (Total n=1,752; <$30K n=474; $30K-$49K n=405; $50K-$79K n=443; $80K+ n=352) * * * Less than 0.5% Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are either married or live with a partner. Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

78. 77 African-American and Hispanic young adults are less likely to have health insurance coverage than others. Are you currently covered by health insurance? (Total n=1,752; Caucasian n=1,227; African- American n=150; Hispanic n=151; Asian/Pac. Islander n=154) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

79. 78 Nearly one-quarter of those employed say they are covered by a traditional pension plan. Half report that no such plan is available. Are you currently covered by a traditional pension plan, also known as a defined benefit plan? (Total n=1,598; Gen Y n=534; Gen X n=1,064) Among employed individuals Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

80. 79 Far more young adults are eligible for a defined contribution plan than a defined benefit plan. Are you eligible for your employer’s defined contribution retirement savings plan, such as a 401(k) or 403(b)? (Total n=1,598; Gen Y n=534; Gen X n=1,064) Among employed individuals Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

81. 80 Although the majority do, roughly one-quarter of young adults do not contribute money to their defined contribution retirement savings plan. Do you personally contribute money to your employer-sponsored 401(k) or 403(b) retirement savings plan? (Total n=866; Gen Y n=213; Gen X n=653) Among employed individuals who are eligible for a DC retirement savings plan Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

82. 81 Propensity to contribute money to an employer- sponsored retirement savings plan increases with income. Do you personally contribute money to your employer-sponsored 401(k) or 403(b) retirement savings plan? (Total n=866; <$30K n=100; $30K-$49K n=227; $50K-$79K n=259; $80K+ n=256) Among employed individuals who are eligible for a DC retirement savings plan * Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are either married or live with a partner. Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

83. 82 The vast majority of young adults show support for voluntary automatic enrollment into retirement plans; nearly half say it’s a very good idea. Generally, do you feel it is a good idea or a bad idea for employers to voluntarily enroll workers automatically in a retirement savings plan and set up automatic contributions from the workers’ paychecks? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

84. 83 Full-time employees are especially likely to view automatic enrollment favorably. Generally, do you feel it is a good idea or a bad idea for employers to voluntarily enroll workers automatically in a retirement savings plan and set up automatic contributions from the workers’ paychecks? (Total n=1,752; Full-time n=1,163; Part-time n=435; Unemployed n=154) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

85. 84 Retirement Mindset

86. 85 Six in ten young adults have given at least some thought to their own retirement, although Gen Xers have thought about it more. In general, how much thought have you given to your own retirement? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

87. 86 Young people with higher incomes are more likely to have thought about their own retirement. In general, how much thought have you given to your own retirement? (Total n=1,752; <$30K n=474; $30K-$49K n=405; $50K-$79K n=443; $80K+ n=352) Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are either married or live with a partner. Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

88. 87 Most young adults expect to live to be (at least) octogenarians. Based on what you know about your health, your family history, and other factors, until what age do you expect to live? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Total Gen Y Gen X Mean81 82 Median808180 Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

89. 88 Most expect to retire between age 60 and 69. Gen Xers are more apt than Gen Yers to say ages 70 to 79. At what age do you think you will retire? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Total Gen Y Gen X Mean636164 Median65 Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

90. 89 Members of both the younger and older generations expect to retire at roughly the same age. At what age do you think you will retire? (This study’s Total n=1,752; RCS Total n=615) Source: 2007 Retirement Confidence Survey (RCS) (Base: non-retirees ages 40+; n=615) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

91. 90 Many say that they have not saved for retirement, outside of Social Security and employer-provided monies. Not including Social Security taxes or employer-provided money, have you and/or your spouse personally saved any money for retirement? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

92. 91 Likelihood of personally saving for retirement falls precipitously as income decreases. Not including Social Security taxes or employer-provided money, have you and/or your spouse personally saved any money for retirement? (Total n=1,752; <$30K n=474; $30K-$49K n=405; $50K-$79K n=443; $80K+ n=352) Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are either married or live with a partner. Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

93. 92 African-American young adults lower rates of personal retirement savings. Not including Social Security taxes or employer-provided money, have you and/or your spouse personally saved any money for retirement? (Total n=1,752; Caucasian n=1,227; African- American n=150; Hispanic n=151; Asian/Pac. Islander n=154) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

94. 93 Overall, these young adults are far less likely than those who are older to say they have personally saved for retirement. Not including Social Security taxes or employer-provided money, have you and/or your spouse personally saved any money for retirement? (This study’s Total n=1,752; RCS Total n=615) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates Source: 2007 Retirement Confidence Survey (RCS) (Base: non-retirees ages 40+; n=615)

95. 94 Still, six in ten young Americans say they are confident that they will eventually save enough to retire comfortably. How confident are you that, when you retire, you will have saved enough money to afford a comfortable lifestyle in retirement? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Net Confident: 59% Net Not Confident: 41% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

96. 95 Confidence in having saved sufficiently for a comfortable retirement is expectedly higher among those with higher incomes. How confident are you that, when you retire, you will have saved enough money to afford a comfortable lifestyle in retirement? (Total n=1,752; <$30K n=474; $30K-$49K n=405; $50K- $79Kn=443; $80K+ n=352) Net Confident: 59% Net Not Confident: 41% Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are either married or live with a partner. Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

97. 96 Older Americans (who aren’t yet retired) are even more likely to express such positive outlooks for their retirement savings. How confident are you that, when you retire, you will have saved enough money to afford a comfortable lifestyle in retirement? (This study’s Total n=1,752; RCS Total n=615) This Study Net Confident: 59% RCS Net Confident: 69% This Study Net Not Confident: 41% RCS Net Not Confident: 30% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates Source: 2007 Retirement Confidence Survey (RCS) (Base: non-retirees ages 40+; n=615)

98. 97 Employer-sponsored defined contribution retirement plans are the largest expected source of retirement income. Few plan to rely on Social Security. Which of these possible sources of income do you think will provide you (and your spouse) with the LARGEST share of income in retirement? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Employer-sponsored retirement savings plan, like a 401(k) Social Security Employer-provided traditional pension Other personal savings/investments, not in a work-related retirement plan Employment The sale or refinancing of your home Something else Not sure Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

99. 98 Far more than the older generations, young adults expect to rely on 401(k)-type retirement plans for their retirement income. Which of these possible sources of income do you think will provide you (and your spouse) with the LARGEST share of income in retirement? (This study’s Total n=1,752; RCS Total n=615) Employer-sponsored retirement savings plan, like a 401(k) Social Security Employer-provided traditional pension Other personal savings/investments, not in a work-related retirement plan Employment The sale or refinancing of your home Something else Not sure Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates Source: 2007 Retirement Confidence Survey (RCS) (Base: non-retirees ages 40+; n=615)

100. 99 Very few young Americans have faith that the Social Security system will provide them with benefits comparable to those received by retirees today. How confident are you that, when you retire, the Social Security system will provide you with benefits of at least equal value to the benefits received by retirees today? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Net Confident: 22% Net Not Confident: 78% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

101. 100 Lack of confidence in Social Security's ability to deliver comparable benefits is consistent, regardless of education. How confident are you that, when you retire, the Social Security system will provide you with benefits of at least equal value to the benefits received by retirees today? (Total n=1,752; High school or less n=243; Some college n=719; Bachelor’s n=571; Master’s or more n=219) Net Confident: 22% Net Not Confident: 78% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

102. 101 Older Americans express more confidence in Social Security benefits than do younger Americans. How confident are you that, when you retire, the Social Security system will provide you with benefits of at least equal value to the benefits received by retirees today? (This study’s Total n=1,752; RCS Total n=615) This Study Net Confident: 22% RCS Net Confident: 35% This Study Net Not Confident: 78% RCS Net Confident: 63% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates Source: 2007 Retirement Confidence Survey (RCS) (Base: non-retirees ages 40+; n=615)

103. 102 Members of Generations Y and X have similarly low expectations that Medicare will deliver benefits equal to those received by retirees today. How confident are you that, when you retire, the Medicare system will provide you with benefits of at least equal value to the benefits received by retirees today? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Net Confident: 28% Net Not Confident: 72% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

104. 103 Confidence in Medicare maintaining current benefit levels is low across education levels. How confident are you that, when you retire, the Medicare system will provide you with benefits of at least equal value to the benefits received by retirees today? (Total n=1,752; High school or less n=243; Some college n=719; Bachelor’s n=571; Master’s or more n=219) Net Confident: 28% Net Not Confident: 72% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

105. 104 Again, the older generations surveyed in RCS have more faith in Medicare benefits than younger adults in this study. How confident are you that, when you retire, the Medicare system will provide you with benefits of at least equal value to the benefits received by retirees today? (This study’s Total n=1,752; RCS Total n=615) This Study Net Confident: 28% RCS Net Confident: 41% This Study Net Not Confident: 72% RCS Net Not Confident: 57% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates Source: 2007 Retirement Confidence Survey (RCS) (Base: non-retirees ages 40+; n=615)

106. 105 Over one-third anticipate helping their retired parents financially; many are understandably unsure whether they will help. Do you expect to provide some sort of financial support to your parents during their retirement? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

107. 106 African-Americans and Asian/Pacific Islanders are especially inclined to expect to provide financial support to their retired parents. Do you expect to provide some sort of financial support to your parents during their retirement? (Total n=1,752; Caucasian n=1,227; African-American n=150; Hispanic n=151; Asian/Pac. Islander n=154) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

108. 107 Financial Education and Literacy

109. 108 Young people do not feel very knowledgeable about certain critical financial tasks. Many say they know more about their iPod than how to do their taxes. How knowledgeable do you feel when it comes to…? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Buying a car Eliminating or avoiding debt How to stick to a budget How to use an iPod Doing your taxes Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

110. 109 Gen Xers feel marginally more knowledgeable about saving for retirement. Knowledge of how the Social Security system works is low among both generations. How knowledgeable do you feel when it comes to…? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Buying a home Saving for retirement How to invest your money outside of the workplace How the Social Security system works Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

111. 110 Though most answer correctly, two in ten young adults are not sure what it means to purchase a company’s stock. If you buy a company’s stock… (Total n=1,752; Gen Y n=613; Gen X n=1,139) * Correct answer Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

112. 111 Research among FINRA’s experienced investors show they are more likely than young adults in this study to grasp what purchasing a stock means. If you buy a company’s stock… (This study’s Total n=1,752; FINRA Total n=1,086) * Correct answer This StudyFINRA’s Study Source: Financial Industry Regulatory Authority’s (FINRA’s) 2003 Investor Literacy Research, with 1,086 investment decision-makers ages 21 to 69 who performed at least one stock, bond, or mutual fund transaction between October 2002 and April 2003 Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

113. 112 Only one-quarter of young adults understand that when interest rates are lowered, bond prices rise; four in ten do not even venture a guess. In general, if interest rates go down, then bond prices… (Total n=1,752; Gen Y n=613; Gen X n=1,139) * Correct answer Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

114. 113 FINRA’s investors are more apt to be aware of the relationship between interest rates and bond prices than the young adults quizzed in this study. In general, if interest rates go down, then bond prices… (This study’s Total n=1,752; FINRA Total n=1,086) This StudyFINRA’s Study Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates * Correct answer Source: Financial Industry Regulatory Authority’s (FINRA’s) 2003 Investor Literacy Research, with 1,086 investment decision-makers ages 21 to 69 who performed at least one stock, bond, or mutual fund transaction between October 2002 and April 2003

115. 114 Two-thirds of young people understand that riskier investing generates higher returns in the long run. True or False: In general, investments that are riskier tend to provide higher returns over time than investments with less risk. (Total n=1,752; Gen Y n=613; Gen X n=1,139) * Correct answer Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

116. 115 FINRA’s investors are also more apt to know that riskier investments yield higher returns. Young adults are more likely to admit they don’t know. True or False: In general, investments that are riskier tend to provide higher returns over time than investments with less risk. (This study’s Total n=1,752; FINRA Total n=1,086) This Study FINRA’s Study Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates * Correct answer Source: Financial Industry Regulatory Authority’s (FINRA’s) 2003 Investor Literacy Research, with 1,086 investment decision-makers ages 21 to 69 who performed at least one stock, bond, or mutual fund transaction between October 2002 and April 2003

117. 116 Four in ten are uncertain about the reasonable rate of return on diversified domestic mutual funds. Gen Xers are more likely to answer correctly. What is a reasonable average of annual return that can be expected from a broadly diversified U.S. stock mutual fund over the long run? (Total n=1,752; Gen Y n=613; Gen X n=1,139) * Correct answer Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

118. 117 FINRA’s investors are more likely to know the average rate of return on a diversified stock mutual fund, while young adults are again more likely to be unsure. What is a reasonable average of annual return that can be expected from a broadly diversified U.S. stock mutual fund over the long run? (This study’s Total n=1,752; FINRA Total n=1,086) * Correct answer This Study FINRA’s Study Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates Source: Financial Industry Regulatory Authority’s (FINRA’s) 2003 Investor Literacy Research, with 1,086 investment decision-makers ages 21 to 69 who performed at least one stock, bond, or mutual fund transaction between October 2002 and April 2003

119. 118 For the most part, those in the younger generations are unsure as to which investment vehicle produces the best returns. Over the last 20 years in the U.S., the best average returns have been generated by… (Total n=1,752; Gen Y n=613; Gen X n=1,139) Stocks* Bonds CDs Money Market accounts Precious metals Not sure * Correct answer Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

120. 119 A sizeable share of FINRA’s investors are also unsure as to which investment vehicle generates the best average returns, though most still answer correctly. Over the last 20 years in the U.S., the best average returns have been generated by… (This study’s Total n=1,752; FINRA Total n=1,086) Stocks* Bonds CDs Money market accounts Precious metals Not sure Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates * Correct answer Source: Financial Industry Regulatory Authority’s (FINRA’s) 2003 Investor Literacy Research, with 1,086 investment decision-makers ages 21 to 69 who performed at least one stock, bond, or mutual fund transaction between October 2002 and April 2003

121. 120 Most understand the tax implications of certain financial actions, though sizable shares are still uncertain. To the best of your knowledge, is the following statement true or false? (Total n=1,752; Gen Y n=613; Gen X n=1,139) Interest paid on a mortgage is tax-deductible (True) Interest earned in a bank savings account is subject to federal income taxes (True) When an employee retires, the money they withdraw from their traditional 401(k) plan is subject to federal income taxes (True) Interest paid on credit card bills is tax-deductible (False) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

122. 121 Only about three in ten young Americans grade themselves an A or B when it comes to saving and investing; more give themselves a D or F. How would you grade…? (Total n=1,752; Gen Y n=613; Gen X n=1,139) How well you are saving money How well you are investing money Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

123. 122 Nearly half grade their parents an A or B for the job they did teaching them about finances, while half give their schools a D or F. How would you grade…? (Total n=1,752; Gen Y n=613; Gen X n=1,139) The job your parents did teaching you about saving and investing The job your schools did teaching you about saving and investing Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

124. 123 Sources of Information

125. 124 Many say their parents are a major source of financial advice. Gen Yers seek advice from their parents more often. Please indicate whether the following is a major, minor, or not a source of financial advice. (Total n=1,752; Gen Y n=613; Gen X n=1,139) Your parents (or in-laws) The internet Your friends or co-workers Periodicals (newspaper, magazines, etc.) Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

126. 125 Financial professionals are a source of advice for some, especially Gen Xers, while the media is a less- utilized source of financial advice. Please indicate whether the following is a major, minor, or not a source of financial advice. (Total n=1,752; Gen Y n=613; Gen X n=1,139) Other relatives Television or radio Someone or something else A financial professional Your (or your spouse’s) employer Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

127. 126 After parents and financial professionals, the internet is young adults’ third primary source of financial advice. Which of these would you say is your primary source of financial advice? (Total n=1,603; Gen Y n=565; Gen X n=1,038) Among those who have more than one source of financial advice Your parents (or in-laws) Your (or your spouse’s) employer The internet A financial professional Periodicals (newspaper, magazines, etc.) Your friends or co-workers Something else Other relatives Television or radio Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

128. 127 Demographics

129. 128 Total (n=1,752) Gen Y (n=613) Gen X (n=1,139) Age 19 to 27 42%100%-- 28 to 3958--100% Mean age292334 Race African-American / Black 12%15%11% Asian546 Caucasian / White60 Hispanic, Spanish, or Latino191720 Pacific Islander*** Other222 Prefer not to answer111 Marital Status Single, never married41%59%28% Married412553 Unmarried, living with a partner111310 Divorced417 Separated1*2 Widowed*--* Other11* Demographics * Less than 0.5% Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

130. 129 Total (n=1,752) Gen Y (n=613) Gen X (n=1,139) Current Employment Status Employed full-time65%58%69% Employed part-time162212 Self-employed either full-time or part-time637 Both full-time and part-time jobs111 Unemployed131610 Spouse’s Current Employment Status Employed full-time70%74%69% Employed part-time787 Self-employed either full-time or part-time536 Both full-time and part-time jobs222 Unemployed161417 Demographics Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates

131. 130 Total (n=1,752) Gen Y (n=613) Gen X (n=1,139) Income** Less than $30,00014%24%9% $30,000 to $49,999273027 $50,000 to $79,999303429 $80,000 to $99,99911614 $100,000 to $199,99911414 $200,000 or more112 Home Ownership Own42%26%54% Rent445635 Some other arrangement141811 Have Children Under the Age of 18 Yes45%25%60% No557540 Demographics * Less than 0.5% **Income is calculated using personal income for unmarried respondents who do not live with a partner and household income for those who are either married or live with a partner. Source: 2008 ASEC & AARP (on behalf of Divided We Fail) Preparing for Their Financial Future: A Look at the Financial State of Gen X and Gen Y, conducted by Mathew Greenwald & Associates