A 10-year study by the National Endowment for Financial Education shows that millennials who are no longer relying on mom and dad for financial help are more confident and happier overall.
The Arizona Pathways to Life Success for University Students (APLUS) project has followed the same group of young adults from their first year in college through adulthood to measure how financial capability relates to happiness. The latest findings marks the fifth time APLUS participants have been surveyed since they started college as freshmen in 2008.
“Despite growing up in a time of instability and change, most of the young adults are doing well,” the researchers noted. “They’re well-educated and employed, living independently and forming relationships. They’re financially capable, confident and able to manage their finances. They’re making prudent financial choices in achieving life goals, often working more hours to make ends meet and saving before purchasing.”
The study found that those who were no longer relying on their parents for financial support and were paying their own bills were more likely to be employed full time, married and starting families.
In addition, financially sufficient millennials are also making better financial choices such as working more hours to earn more and saving up for big purchases instead of accumulating credit card debt.
But parents still play a vital role in their children’s financial future, says Ted Beck, NEFE’s CEO, according to CNBC.
“Talk to your kids about money,” he said. “Parental influence is by far and away the strongest indicator of future financial behavior.”
“Like the talk about sex, don’t try to sit down once and pass along all your knowledge,” he added. “Break it into pieces so it’s absorbed.”
With that in mind, Beck recommends having regular discussions about how money factors into family decisions, as well as being honest about your own financial missteps.
This is especially important since so many Americans are living on the “financial edge.” Another NEFE survey found that 36 percent of American working adults could not cover an unexpected $2,000 expense within 30 days. The data also showed that 41 percent could not cover an immediate expense of $400.