Kids and Banking
We researched corporate websites, market reports, white papers, and trusted media sites to find you the inquired information on financial concerns for young people, motivations for switching banks, digital habits of kids and young adults, banking options for young adults and first banking experiences. Below you will find a deep dive of our findings.
FINANCIAL CONCERNS FOR YOUNG PEOPLE
For the purpose of this research we included both reports on Generation Z, young people under the age of 21 and Millennials, young people aged 22 to 37, so that we could cover the full scope of your 15-25 age requirement. As stated by Pew Research, these are the ages they would be as of 2018.
The Millennial age group reported that their three biggest concerns were too much debt, rent and living expenses, and maintaining a budget. According to Forbes, 27% of Millennials reported that credit card debt was their biggest worry and 25% reported that student loan debt was their largest concern. High costs of living and managing a budget were the next biggest worries.
A notable trend between Millennials and Generation Z is that Millennials tend to worry about current expenses, whereas Generation Z is more concerned with the future. Generation Z named saving for college as their biggest financial concern, followed by saving for future obligations and saving for retirement. Generation Z are "less reckless spenders" than Millennials. According to research by the Levo Institute and the Adecco Millennial, paying for college and paying for their own housing arrangements were two of Generation Z's top consternations.
MOTIVATIONS FOR SWITCHING BANKS
According to the NGDATA 2017 Consumer Banking Survey, "41.4% of consumers cited bad customer service as the reason they would switch to a new bank, an eight percent increase from 2016. Customer service is nearly tied with cost and fees (41.7%) as the key factor leading to churn. "
The survey also reported that, "nearly 40% of 18-34 year olds say they believe banks should leverage emerging automation technology like robots to improve their experience."
According to the most recent survey by First Data, 37% of consumers reported better rates as an important factor for switching banks, followed by 35% who reported lower fees, 28% reported more convenient branches, 24% reported more convenient ATMS, 24% also reported rewards or recognition for being a loyal customer, 23% reported moving to a new location, and 23% reported customer service.
According to Bankrate, satisfying customer service keeps 34% of consumers from switching banks and according to a survey by Kasasa, "83% of Millennials would switch banks if one offered more or better rewards."
DIGITAL HABITS OF KIDS AND YOUNG ADULTS
According to Statista, 88% of US teenagers between the ages of 13-17 have access to a laptop or desktop. In 2016, online users aged 13-18 averaged 465 minutes online per a month, which was significantly lower than other age brackets. Online users aged 18-24 spent averaged 2,094 minutes online a month. According to Growing Wireless, 88% of US teenagers have access to a cell phone and 58% have access to a tablet, with 91% reporting they access the internet via a tablet.
According to the Statista 2018 Spring survey, “Snapchat was the most important social network for 48% percent of US teens.” This was followed by Instagram at 26%, Twitter at 9%, Facebook at 8% and Pinterest at 1%. There was no data published for the 18-24 age group. According to Pew Internet, "78% of 18- to 24-year-olds use Snapchat, and a sizable majority of these users (71%) visit the platform multiple times per day. Similarly, 71% of Americans in this age group now use Instagram and close to half (45%) are Twitter users. In addition to adopting Snapchat and Instagram at high rates, the youngest adults also stand out in the frequency with which they use these two platforms. Some 82% of Snapchat users ages 18 to 24 say they use the platform daily, with 71% indicating that they use it multiple times per day. Similarly, 81% of Instagram users in this age group visit the platform on daily basis, with 55% reporting that they do so several times per day."
BANKING OPTIONS FOR YOUNG ADULTS
There are numerous banking options for young adults and teenagers in the United States. According to GoBankingRates, the top banks for young adults are Capital One 360, Wells Fargo, TD Bank, Bank of America, Bay Federal Credit Union, Discover Bank, Santander Bank, US Bank and Navy Federal Credit Union. We have organized and summarized the information in the attached spreadsheet.
FIRST BANKING EXPERIENCE
In most situations, parents must also be on financial accounts for minors under the age of 18. This is because contracts with minors are rather complex. Therefore, it is easier for banks to have a guardian on the account. There is typically no age requirement if there is a guardian attached to the account. Unfortunately there was no information published on the average age in which a first bank account is opened. We believe this is because parents typically open a child's first bank account and are listed as a guarantor. Banks typically do not keep track of demographics regarding minors listed on accounts.
According to the 8th Annual Parents, Kids & Money Survey, " a total of 79% of kids have either a savings account or a piggy bank." Of those surveyed, 57% of children under the age of 18 had a savings account, 50% had a piggy bank, 31% an online gaming account, 24% a checking account, 18% a credit card and 14% an investment card. Only 8% of children had none of the options listed above.
In conclusion we have provided you with information on financial concerns for young people, motivations for switching banks, digital habits of kids and young adults, banking options for young adults and first banking experiences. We hope that you find this useful.