Class of 2020 Significantly Impacted by COVID-19, concerned about financing college and financial future
COVID-19 has significantly impacted how teens are thinking about their financial futures, prompting 25 percent of 2020 high school graduates to delay their college plans in the face of reduced financial support from parents and guardians because of the pandemic, according to a new survey from Junior Achievement (JA) and Citizens. The findings, which indicate broad-based concern among teens regarding how they will pay for higher education, highlights an increased need for financial literacy curriculum that empowers them to make financial decisions that will impact them over the long term.
The pandemic has had a disproportionate impact on teens of color, with 60 percent of Black and 59% of Hispanic teens in 11th or 12th grade reporting that COVID-19 has affected how they will pay for college, compared to under half (45%) of their White peers.
The survey was conducted among 2,000 American teens ages 13 to 19 who are not in college and 500 teens who graduated high school in 2020.
“The past year has brought unprecedented challenges and uncertainty to everyone, and high school students are feeling this uncertainty as they navigate the transition to the next phase of their lives post high-school,” said Christine Roberts, Head of Student Lending at Citizens. “Equipping students with the skills and knowledge they need to make important financial decisions is critical to easing uncertainty and ensuring teenagers are able to make sound financial decisions.”
Despite showing greater uncertainty and anxiety among young people amid the challenges created by the pandemic, the survey revealed an overall sense of optimism among respondents, with a majority (74%) of teens who have not yet graduated high school remaining bullish about their financial future. Even with many delaying post-high school plans, most of the Class of 2020 (65%) remains optimistic overall about their financial future.
Many of those surveyed reported that COVID has prompted their families to pare back financial support for college. Nearly three-in-four (72%) Class of 2020 high school graduates planning to attend college expect their parents or guardians to pay at least part of their college education, and among them, 37 percent say their parents or guardians will cut back on their planned financial support for college education due to COVID. About four-in-five juniors or seniors in high school (81%) planning to attend college expect their parents or guardians to pay at least part of their college education, and among them, 43 percent say their parents or guardians will cut back on planned financial support for college.
“Last spring there was concern about how the pandemic would impact the Class of 2020, and this survey reinforces those concerns,” said Les McCabe, President & CEO of JASoCal “After the financial crisis of 2008, we saw a doubling of student loan debt and young adults impacted by that situation delaying major life decisions, such as purchasing a home, starting families and planning for the future. It is important that we offer support for today’s teens experiencing the economic fallout from COVID. For Junior Achievement, that means providing education about critical life skills to help them navigate uncertain times.”
Additional survey findings include:
- More than half (55%) of Class of 2020 high school graduates have discussed their families’ finances more as a result of COVID, compared to just 44% of teens who have not yet graduated high school.
- Two-thirds of Class of 2020 high school graduates (69%) are somewhat or very concerned about the financial impact of COVID-19 on their families, compared to just over half (55%) of teens who have not yet graduated high school.
More information and an executive summary are available at this link.