It’s been two years since the COVID-19 pandemic began its rampage across the United States and the globe. As a result, populations internationally have begun to struggle financially. However, now, a recent study proves America‘s youngest generations, millennials and GenZ, have been struck especially hard. Many of these individuals have revealed the pandemic has almost entirely eaten away at their savings.
According to a study detailed in CNBC‘s Make It, little more than half of Americans, a total 53%, shared they still have more funds available in their emergency savings than they do in credit card debt. More specifically, a survey completed by Bankrate revealed 46% of Gen Z respondents, between the ages of 18 and 25, now possess less in emergency savings than at the start of the pandemic. The same survey revealed 43% of millennials, aged 26 to 41, experienced the same hardships.
Further, the outlet revealed younger millennials (26-32) took the brunt of the pandemic’s financial hardships. A total of 54% now majorly lack in emergency savings.
Altogether these totals far surpass overall financial decline for older Americans, including the GenX and Baby Boomer generations. The same survey noted GenXers saw their savings decline by a lesser 37%. Meanwhile, Baby Boomers saw the least of the pandemic’s financial stressors, with just 27% reporting a decline in savings.
Bankrate.com’s chief financial analyst, Greg McBride, stated the survey’s findings come as a “byproduct of the income disruptions that were disproportionately borne by younger workers during the pandemic, particularly millennials.”
Unemployment Struck Younger Americans Hardest Amid Pandemic
Bankrate’s survey clearly demonstrated the financial inequity present across American generations. However, it also spotlighted a lack of fair employment opportunities and perks available to young populations amid the COVID-19 pandemic.
Alongside a depletion of savings, the outlet stated Americans aged 18 to 29 struggled the most with unemployment.
The Economic Policy Institute revealed that in 2020, GenZers were most likely to experience unemployment due to the pandemic. Further, that same generation, alongside younger millennials, were the first to see themselves pushed out of jobs, in addition to taking increased pay cuts.
In coordination with that underemployment, many of those same Americans saw a major increase in credit card debt. The uptick occurred as income dwindled and savings were rapidly depleted. Bankrate states 32% of millennials overall now possess more in credit card debt than they do in savings.
Meanwhile, many GenZers have managed to do fractionally well in this regard, with just 23% of the survey’s respondents reporting an overall increase in credit card debt compared to total savings.
However, that said, many Americans, struck by the pandemic’s financial hardships in some regard, possess no emergency funds whatsoever. According to the CNBC report, just about 1 in 7 households boast 0 credit card debt, although it’s those same individuals who have absolutely no savings. Of this particular situation, McBride stated these individuals and families are the ones most likely to encounter unexpected, significant expenses.