Many of us probably think millennials cope with financial stresses easily because of their education and improving job prospects. We took a look at the local level of financial stress in the 2016 Metro Atlanta Speaks (MAS) Survey by asking respondents “If you had to come up with $400 for an unexpected emergency, how would you pay?”  The respondents could choose from the following answers:

  • Pay with cash/check/debit card
  • Pay with credit card
  • Not able to pay now
  • Borrow money
  • Sell or pawn something
  • Don’t know

By analyzing the results in terms of the respondents’ age, we find that around 40 percent of the millennials in the region either could not cover an emergency expense costing $400, or would cover it by selling something or borrowing money, compared to 33 percent of the all residents in the region reporting those same answers (Figure 1).

To put this into a national perspective, the Federal Reserve (FED) asks a similar question in its national well-being survey. In the FED’s survey, however, 46 percent of all respondents said they either could not cover an emergency expense costing $400, or would cover it by selling something or borrowing money. So that 46 percent is higher than what we found locally, but, as pointed out earlier, we didn’t ask the question in exactly the same way. Specifically, the FED’s survey split out “pay for with credit card” to include both paying it off at the end of the month (thus incurring no additional expense) or paying it off over time (which, essentially, is the same as borrowing the money. So we can’t draw too many comparisons to the national survey. But, regardless, finding that 40 percent of millennials (and 33 percent overall) could not cover this expense is surprising, given strength of the metro Atlanta economy.

The percentage of millennials who had financial hardship to cover this expense varies substantially across counties in the region (Figure 2). DeKalb and Clayton were the two counties in the region where more than half of the millennials said they either could not cover this expense, or would cover it by selling something or borrowing money. In other words, they have financial hardship in paying for it. This is not a coincidence, given that poverty and unemployment rates are the highest in these counties in the region (Figure 2).

The percentage of millennials who said they either could not cover this expense, or would cover it by selling something or borrowing money also varies across gender in the region (Figure 3). Compared to 31 percent of the male millennials in the region, 52 percent of the female millennials would experience a financial hardship with a $400 emergency.

When we examine the results by race of millennials, we can see that across the region 50 percent of the African American millennials and 49 percent of the millennials of other races said they either could not cover this expense, or would cover it by selling something or borrowing money, compared to 29 percent of the white millennials (Figure 4).

Considering levels of education, 53 percent of the millennials with high school degree or lower would experience financial hardships with having to pay a $400 emergency, compared to 8 percent of those with a graduate or professional degree, 21 percent with a Bachelor’s degree, or 40 percent of those with some college or associate degree.

In summary, millennials who are female, nonwhite, or have lower levels of education tend to have financial hardship in paying $400 for an emergency (either could not cover this expense, or would cover it by selling something or borrowing money) in the Metro Atlanta area, compared to their counterparts.