A recent survey conducted by Decima Research asked non-homeowners under age 34 for some savings and home purchase feedback.
Just like paying off our debts, the survey shows a real disconnect between the reality of what’s happening and the dreams of what the respondents would like. Here’s what I mean:
The survey involved over 1,200 people aged 21 to 34 who had aspirations to purchase a home in the near future. Of those, nearly a third still live at home to save for a down-payment. But even in the 31 to 34 year group, 22% in Toronto and 17% in Calgary and Halifax, are still living with their parents.
The response was that they’d likely be purchasing a home in the next few years – yet they’d only been saving for a down-payment for an average of 1.6 years. And what are they saving? Less than 13% of their income – even though they’re still living at home.
The respondents said they’d likely save more than 15% for a down payment and that it’ll take less than four more years to save all that. However, this shows a real disconnect between what they’d like to do and what they’re actually doing, in real terms, to save a ton of money.
The savings aren’t happening, even when this age group has a real focused and tangible goal. In a US survey released last week, the pollsters asked 18 to 21 year olds whether they’d start a savings plan of some kind in 2007. Over 90% of them said yes – but when that’s compared to the survey the year before – less than 20% actually did.
It’s not just Generation Y, but don’t all of us have real trouble finding a way to save? Why? Because for this group, it’s likely impossible due to student loans and their credit cards. But for the rest of us, isn’t it also our current debts that are killing our dreams for the future?
Actions speak louder than words and just having good intentions doesn’t make anything happen. It takes a big goal, a strong desire, a specific financial plan and payroll deduction or the savings coming right out of our bank account. It’s called paying ourselves first. But for many of us, just paying down our debts much faster is also a way to generate huge savings. Savings in interest and lots of payments that we now won’t have to pay to make someone else rich.