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Teens Impacted By Recent Recession, Says Finance Survey

The perception that teenagers have of the economy has been significantly impacted by the most recent recession, according to a finance survey conducted by major financial services firm Charles Schwab.

The survey, which was titled "The 2011 Teens & Money Survey," was conducted by Koski Research and was commissioned by the major financial services firm. It involved 1,132 U.S. teens aged 16 to 18 and was done between February 21 and March 14, 2011. The polls were conducted in order to explore their perceptions, knowledge and activities of earning money, expenditure, borrowing wealth and also saving it.

Survey results 

According to the 2011 Teens & Money Survey, almost all teenagers specified that their families were affected by the recession. A total of 93 percent provided this reply, with 55 percent saying that the economic event impacted their family was impacted "a little," 38 percent specifying that it had "a lot" of influence." Only 7 percent indicated that the recent economic downturn had no impact.

Many of the participants in the survey specified that the recession influenced their outlook on the economy and their expectations, such as making the financial challenges existing in society more salient as well as making them more grateful for what they have.

Changing viewpoint

The perception of many teenagers was altered by the Great Recession, with 64 percent indicating that they are now more grateful for the wealth, resources and opportunities that they have. In addition, more than 58 percent said that the economic turmoil has reduced the odds of them asking for things they want.

Family appreciation

The survey revealed that as a result of the recession, 34 percent of participants specified that their family now spends a greater amount of time discussing how to effectively manage money. The fraction of respondents indicating that they now have increased appreciation for their family is 39 percent. Also, 56 percent specified that they appreciate the hard work of their parents more than before.

Financial preparedness

Many teenagers reported that they have learned important lessons as a result of the most recent recessions. Almost three-quarters, or 73 percent of participants, emphasized the importance of having adequate savings, stating that they need to have money in case times get tough.

A lot of them indicated a growing mindset of financial conservatism, with 59 percent stated that it would not take them much to go too far and overspend during times of abundance. A total of 51 percent said that knowing the costs of taking out loans is important before borrowing money.

The salience of the potential drawbacks of purchasing a house rose, with 49 percent stating that they need to know all needed terms and conditions as well as the costs that will be incurred in such a transaction.

"It seems clear that the great recession has changed the mindset of teens. It has given these 'Recession Generation' youth a deeper appreciation for what they have and how hard their parents work," Carrie Schwab-Pomerantz, senior vice president of Schwab Community Services, said in a statement. "This may be the silver lining to the economic downturn since it gives parents and educators an enhanced opportunity to communicate critical lessons about financial decision-making."

Implications

The changing mindset of these teenagers could certainly have positive implications for them as individuals, making them more prepared for harsh economic circumstances and ready to save the money needed to survive recessions like the most recent one.

However, the new mindset of these individuals could be detrimental to the U.S. economy as a whole, as their new conservative attitude could undermine consumption, which accounts for roughly two-thirds of gross domestic product. 

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