Navient | Money Under 35 1

Young adults in their 30s are more likely to balance their checkbook by hand than those in their 20s (27% of 31-35-year-olds, vs. 20% of 22-30-year-olds). Young adults in their 30s also are slightly more likely to say they use a spreadsheet to manage their finances (23%, vs. 19% of those in their 20s). Men and women are very similar in their money management preferences, although men display a slight preference for computer programs (16% of men compared to 9% of women).

Young adults who have completed a college degree are more likely to use computer-based tools to manage their money. These degree holders are more likely to use their bank’s website or app to manage their money (59% vs. 47% of non-degree holders) and are twice as likely to use a spreadsheet (29% vs. 14% of non-degree holders).

Navient’s Money Under 35, a national study conducted by Ipsos, provides a snapshot of the financial lives of young Americans aged 22 to 35 across all levels of educational attainment. To celebrate Financial Literacy Month, we dive deeper into the various methods and tools young adults employ to manage their financial lives.

Managing finances

Today there are numerous options available for managing finances. While many young adults take advantage of this variety and use a combination of tools, roughly 1 in 10 young adults does not use any of these money management methods. The majority of young adults report using online tools to help manage their finances, although they haven’t backed away completely from “traditional” methods.

In 2017, half of young adults surveyed reported using their bank’s website or app to keep track of their money (52%), growing in popularity from 40 percent in both 2015 and 2016. Balancing checkbooks by hand is the second most popular method, used by 1 in 4 young adults (23%), but has decreased significantly from prior years. One in 5 young adults uses a spreadsheet to keep track of his or her finances. Regardless of the methods employed, nearly all young adults (83%) proactively manage their finances; 13 percent report that they do not use any of these methods and 4 percent have someone else manage their finances.

0%

20%

40%

60%

Bank’s website or app

Balance checkbook by hand

Spreadsheet Computer program (e.g., Quicken)

3rd party app(e.g., Mint)

Someone else manages my

finances

None of these

2015 2016 2017

40%36%

19%

10% 11% 4% 10%

40% 39%

26%

12%15%

4% 10%

52%

23%20%

12%9%

4% 13%

MONEY UNDER 35

How Millennials Manage Their Money

Money management methods 2015 - 2017

Bank app or website usage has increased 30%, while 41% fewer young adults balance their checkbook by hand

Degree holders are more likely to manage their own finances rather than have someone else do it; 1 percent of degree holders reported having someone else manage their money, compared to 5 percent of non-degree holders. Young adults who have not earned a degree are much more likely than degree holders to report not using any of these formal methods for managing money – 18 percent compared to 7 percent of degree holders.

Navient | Money Under 35 2

Young adults with self-described “very good” financial health1 are more likely to:

• Balance their checkbook by hand (28% vs. 13% who rated their financial health as “poor”)

• Use a spreadsheet to track their money (26% vs. 11% who rated their financial health as “poor”)

• Use a specific financial computer program like Quicken (21% vs. 4% who rated their financial health as “poor”).

Nearly 1 in 4 young adults (23%) with self-described “poor” financial health does not use a formal money management method, more than their peers with self-described “neutral” (14%) or “very good” (9%) financial health.

Paying the bills

Just as young adults report using technology for managing their finances, they are also likely to use technology to pay bills:

• 51% use auto-pay

• 52% have automatic deposits set up for their savings accounts

• 60% receive only e-statements or e-bills

• 65% do most of their banking on their smartphone

• 79% believe their online banking and financial transactions are secure

0%

20%

40%

60%

Bank’s website or app

Balance checkbook by hand

Spreadsheet Computer program (e.g., Quicken)

3rd party app(e.g., Mint)

Someone else manages my

finances

None of these

Non-degree holders Degree holders

47%

23%

14%10%

7%5%

18%

59%

21%

29%

15%11%

1% 7%

0%

20%

40%

60%

50%

30%

10%

Bank’s website or app

Balance checkbook by hand

Spreadsheet Computer program (e.g., Quicken)

3rd party app(e.g., Mint)

Someone else manages my

finances

None of these

Very good (8/9/10) Neutral (4/5/6/7) Poor (1/2/3)

54%

28%26%

21%

11% 3% 9%

52%

21% 19%

9% 8%4% 14%

48%

13%11% 4%

7%

6%

23%

Money management methods, by education level

Money management methods, by self-described financial health

Degree holders are more likely to use computer-based tools to manage their money

Young adults with “very good” financial health are more likely to balance their checkbook by hand or use computer-based tools to manage their money

1 Respondents rated their financial health on a scale of 1 to 10. Ratings of 8, 9 or 10 are categorized as “very good”; ratings of 4, 5, 6 or 7 are categorized as

“neutral”; and ratings of 1, 2 or 3 are categorized as “poor”.

Navient | Money Under 35 3

Methods of payment used by education level

Degree holders are 63 percent more likely to pay with a credit card than non-degree holders

0%

20%

40%

60%

80%

100%

Cash Credit card Debit card Check Mobile payment app

Degree holdersNon-degree holders

84%

48%

73%

14% 17%

79% 78% 76%

22%28%

A larger share of young adults use debit cards for purchases (75%) rather than credit cards (60%). One in 5 young adults uses a mobile payment app such as Apple Pay or Venmo (22%). Young adults in their 30s are more likely to use credit cards than adults in their 20s (65% of 31-35-year-olds vs. 57% of 22-30-year-olds) or pay with a check (21% of 31-35-year-olds vs. 15% of 22-30-year-olds).

Young adults who have completed a college degree are significantly more likely to use credit cards – 78 percent of degree holders compared to 48 percent of non-degree holders. Less commonly utilized methods of payment, such as checks or mobile payment apps, are also more likely to be used by degree holders than non-degree holders.

Financial awareness

The majority of young adults report that they track their finances closely. More than three-quarters (76%) of young adults say they always know how much money is in their bank account, with that awareness varying little by age. That financial awareness does not appear to be driven by necessity; young adults who report not having money left to spend on the things they want after paying their bills are no more likely to say they always know how much money they have on hand than those who do have money left after paying their bills.

Methods of payment used by age

Young adults in their 30s pay with credit cards or checks more frequently than those in their 20s

0%

20%

40%

60%

80%

100%

Cash Credit card Debit card Check Mobile payment app

All 22-35 Age 22-30 Age 31-35

82%

60%

75%

18%22%

83%

57%

75%

15%22%

79%

65%

74%

21% 21%

Navient | Money Under 35 4

Most young adults check their finances before (73%) or after (73%) they make a purchase. While a slight majority (52%) of young adults say they schedule automatic deposits into savings accounts, that practice is more common among adults in their 30s (58%) than adults in their 20s (49%).

More than half young adults (56%) report that they have a monthly budget that they follow closely. While that share varies little by age group, 34-35-year-olds are slightly more likely to follow a budget (63%, compared to 55% of 22-33-year-olds).

Advanced degree holders are more likely to follow a budget (72%) or use autopay for their bills (76%) than their less-educated peers. Adults who have completed a bachelor’s or advanced degree are more likely to schedule automatic deposits into savings (68%) than adults with either an associate degree (50%) or no college degree (42%). Degree holders overall are more likely to always know their account balance (82%) compared to non-degree holders (70%).

Common financial behaviors

Common financial behaviors by education level

Three in 4 young adults always know their bank account balance and check their finances before and after making a purchase

Degree holders more likely to always know their bank account balance than non-degree holders

0% 20% 40% 60% 80%

Use autopay for my bills

Have automatic deposits for savings

Have a monthly budget that I follow closely

Only receive e-statements

Do most banking on smartphone

Use my smartphone app daily

Check finances after purchase

Check finances before purchase

Always know bank account balance

51%

52%

56%

60%

65%

71%

73%

73%

76%

0%

20%

40%

60%

80%

100%

Use autopay for my bills

Schedule automatic deposits for savings

Have a monthly budget that I follow closely

Only receive e-statements

Always know bank account balance

High school or less Some college, no degree Associate degree Bachelor’s degree Advanced degree

43%46%51%

59%

76%

40%46%

50%

66%73%

54%50%

60%57%

72%

46%

59%61%

70% 70%70%

80%82%85%77%

Navient | Money Under 35 5

In addition to following budgets and monitoring their finances closely, most young adults are well informed about their debt. The majority who have a mortgage, auto loan or credit card know the interest rate, and just under half (45%) of young adults say they know the interest rate on their student loan.

0%

20%

40%

60%

80%

Mortgage Auto loan Student loan Credit card

All Very good (8/9/10) Neutral (4/5/6/7) Poor (1/2/3)

68%

60%

45%

59%

71%66%

57%

75%

65%59%

44%

54%58%

50%

28%

42%

Savings methods by educational attainment

Awareness of interest rate by self-described financial health

Standard savings and checking accounts are the most common vehicles for savings

Adults with “very good” financial health are more likely to know interest rates of their loans

0%

20%

40%

60%

80%

100%

Savings account Checking account 401(k) Piggy bank Investments Long-term savings(money market, CD)

529 Account

All High school or less Some college, no degree Associate degree Bachelor's degree Advanced degree

66%

47%

33%

18% 17%12%

3%

56%

42%

24% 25%

11%9%

1%

64%

49%

25%21%

12%9%

2%

71%

48%

31%

15% 16% 14%

4%

78%

50%47%

10%

26%

15%

4%

72%

45%

53%

6%

29%

19%

10%

As with other positive financial behaviors, young adults who report their current financial health as “very good” are more likely to be aware of the interest rates on their various loans than those who view their current financial health as “neutral” or “poor.”

Saving money

Nearly all young adults say they are saving in general or for a particular goal (93%). Among young adults who reported that they are currently saving, the most common vehicles used are standard savings or checking accounts. Saving through a 401(k)-retirement account or 529 college savings account is more common for adults in their 30s than for adults in their 20s; 39 percent of young adults in their 30s save using a 401(k) and 5 percent save using a 529, compared to 30 percent and 2 percent respectively for young adults in their 20s.

Young adults with at least a bachelor’s degree are more likely to use a dedicated retirement fund or an investment account as a method of saving, 48 percent compared to 31 percent of associate degree holders and 25 percent of non-degree holders. Advanced degree holders, for whom saving for their children’s education is their top savings priority, are more likely than their peers to report using a 529 savings account.

Navient | Money Under 35 6

Navient is committed to helping young people establish healthy financial habits, starting with the transition from school to successful loan repayment. Navient offers a variety of free resources such as:

To read the full Money Under 35 report, please visit Navient.com/MoneyUnder35.

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