New Survey Shows "Gen Y" in Financial Trouble

Nearly 30 percent report having difficulty in managing their spending; about 27 percent have been turned down for a loan or line of credit.

A financial storm may be brewing for many of the more than 87 million Americans age 18-34, popularly known as "Gen Y," according to survey results just released by Western Union, a payment services company.

Gen Y'ers are generally described as creative, independent and tech savvy, while at the same time they are sometimes seen as overly confident and impatient. Many are also in trouble financially, according the survey of 3,000 consumers, which was conducted by Javelin Research.

The survey detailed the following findings from Gen Y respondents:

-- Nearly 30 percent report having difficulty in managing their spending, more than 20 percent wait longer to pay their bills, and 35 percent have borrowed money from friends or family members.

-- Half of Gen Y respondents reported feeling increased stress about financial obligations in the last six months.

-- More than one in three members of Gen Y say that their financial situation has worsened in the last six months.

-- About 27 percent of Gen Y survey participants have been turned down for a loan or line of credit.

-- Sixty percent of Gen Y'ers have not seen their credit score in the past year, and 44 percent have never seen their credit score.

"The silver lining is that, in spite of the difficult economy, Gen Y is engaging in money-savvy behaviors that can help build a better financial future," says David Shapiro, senior vice president, Western Union. "The Money Mindset Index identified Gen Y's use of tools such as online bill pay to manage their budget and credit standing. Factor in their high comfort level with web-based programs and budgeting tools, and Gen Y has a solid foundation for getting their finances back on track."

Gen Y's difficulties are in contrast to other survey respondents, many of whom are seeing positive changes in their financial situation including less impact from economic challenges such as changes in credit card limits and increased interest rates, a declining need for spending cutbacks, and decreased shopping at "discount" retailers. While gains in economic confidence are certainly not dramatic, the trend toward cautious optimism continues to grow.