Operating and Financial Leverage in Gen Y Households
Gen Y is the largest, most educated and ethnically diverse demographic group in U.S. history, projected to make up 75% of the world’s workforce by 2050.
Members of Gen Y (also called millennials, born between 1980 and 2000) tend to be financially fragile. This study demonstrates the critical importance of engaging Gen Y early in their lives to help them manage their personal finances and ensure their financial well-being.
In a study spanning 16 years, the author asked 500 diverse, senior-level undergraduate students to create a comprehensive financial plan, build a financial balance sheet and analyze their financial positions. Using a representative sample of this information, he observed high levels of household leverage, measured in both operating and financial terms.