Contents
INTRODUCTION: 3
BACKGROUND: 3
RESEARCH QUESTIONS: 4
HYPOTHESES: 4
INVESTMENT OVERVIEW: 4
-CASH AND EQUIVALENT…………………………………………………………………………………………………
-BONDS……………………………………………………………………………………………………………………………
- STOCKS……………………………………………………………………………………………………………………………
QUESTIONNAIRE OVERVIEW: 6
APPENDIX A: 8
REFERENCES: 9
INTRODUCTION:
The purpose of this study is to investigate the investment practices of youth in my region. All youth should be investing financially for the future- for differing reasons. Some reasons may be for when their working years are over, or as a safety net in case they need extra unforeseen reserves. However, not all youth do invest, and those that do- invest differing amounts in different ways. This study will investigate how much the youth do invest, what investment types are commonly used and through which vehicles.
BACKGROUND:
Investment is defined as an “asset or item that is purchased with the hope that it will generate income or appreciate in the future” (investopedia Jan 1 2014). Not all assets generate the same return however, as this depends on which investments are made, through which vehicles and the length of time of the investment.
Young people between the ages of 18-30 are usually still studying or in their early years of work. They have a lower salary at that age, and have less leverage to cover both their debtexpenses and save financially.
Youth unemployment is also high-according to Deloitte statistics 42% of people under 30 years of age are unemployed, and a total of 24.7% unemployment rate across all ages according to Statistics South Africa (05 Feb 2014). This leads us to the assumption that fewer youth are saving as they have no income to save from.
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The Wall Street Journal, ‘State Street Report Takes the Pulse of Buy-Side Firms Mandated to Clear OTC Derivatives.’ State Street Corporation, 30 July 2013
Wiley, ‘Definition of debt instruments.’ UNISA library (http://0-onlinelibrary.wiley.com.oasis.unisa.ac.za/doi/10.1002/9781118258248.ch1/pdf)
Wiley, ‘Definition of equity instruments.’ UNISA library (http://0-onlinelibrary.wiley.com.oasis.unisa.ac.za/doi/10.1002/9781118258248.ch1/pdf)
www.bondexchange.co.za , uncategorized, ‘volcano eruption for SA bonds.’ 6 may 2013
www.budgeting.about.com 23 Jan 2013
www.investopedia.com
www.southafrica.info/business/economy/econoverview
www.wisegeek.com/what-are-the-different-types-of-financial-investments.htm
Despite the type of broker an investor opts for, the stock market has the potential to generate high returns through an investment strategy. One of the main strategies employed is diversification, which involves the purchasing of different stocks with varied performance and rates of returns in order to spread out the risk of the individual stocks across a portfolio. Investing in stocks is therefore one of the most profitable alternatives to personal financial planning, and should be considered as one of the investment vehicles that generates an additional income stream. Significance of Stocks in Personal Finance Personal income is considered to be a person’s total earnings, which can be obtained through wages and salaries, personal business activities, social aid and investment. The choice to invest in one’s finances rather than spend on consumption has an overall impact of increasing income as a result of future cash inflows from the investments (Markowitz 76).
Researches have noticed that millennials are better educated than any other generation. However, they tend to have lower earnings and are more likely to live in poverty. They also have significantly higher student loan debts and levels of unemployment, with much lower personal incomes. It seems that, although they are more educated, the cost of this schooling is burying millennials in debt. Only 42% of millennials now consider
Investment. An investment is an asset or item that is purchased with the hope that it will generate income or appreciate in future. In an economic sense, an investment is the purchase of goods (in our case being the Adidas Yeezy shoes) that are not consumed today but are used in future to create wealth and also in a financial sense an investment is a monetary asset purchased with the idea that the asset will provide income in the future or appreciate and be sold at a higher. Investment involves putting money, time and effort. One first has to have a
Even with school, "Generation Debt" are the backbone of the work society; however, they continue to struggle with loans and debt. Wal-Mart and McDonalds are the nation's top employers; the latter being the largest youth employer. The "youth class", as Kamenetz points out, is one of the reasons why the labor market has downgraded to a point where it can pander to the entry-level workers. And even those who are better-off fair no better. Many young people with bachelor's degrees join those who are underemployed, or even unemployed.
The effect debt has on young adults is severe. More and more young adults today battle with debt and how to deal with it. I know many people who pay cash for everything they purchase, while this a admirable ambition it is often difficult for most Americans. I see debt a lot like cramming for a test. Although you may get the problem fixed in a short-term matter, it comes back up later and often tends to be more serious than before. This is why taking care of debt now is crucial. There are many ways to avoid debt but the first ones I can think of are not impulse buying. This is something I struggle with recurantly, and often times with clothing. I may not be in need of a new shirt nor can I afford one but I get sucked into the
The BBC news reveals that young people are in danger of being trapped in a lifetime of unemployment. ONS (Office for National Statistics) disclose some intimidating figures which include 115,000 18 year olds to 24 year olds unemployed for longer than two years.
Since the late 1970s, social science researchers, the media, private foundations, and policymakers have directed considerable attention to the labor market problems of young adults and their families. Most of this attention has focused on high school dropouts, the poor, minorities, and inner-city youth. But an equally troubling—and broader—problem has received comparatively less notice: the steep and sustained decline since 1973 in the real (inflation-adjusted) earnings of young men and women generally. Even adjusting for demographic and socioeconomic characteristics, the labor market problems of young workers are disproportionately severe—they include higher than average unemployment and relatively low earnings when employed. This sustained drop in earnings has been especially dramatic for young adults with no postsecondary school education.
Are youths more susceptible towards demographic changes in regards to rising debt levels? Increasing debt levels are posing a dilemma for many Canadians – especially the younger generation. Six out of ten Canadians between the ages of 18 to 29 have debt, with 60 percent of household debt coming from those under the age of 45. Younger people are starting to borrow money even before their careers begin. With an increased cost of living set to raise about 3 percent by the end of 2017, it seems almost impossible to create a “successful” lifestyle by living within our means.
This paper will serve as a discussion on the topic of investment banking. In this paper the author includes various articles and thoughts that help to understand the background and principle of investment banking. This discourse will attempt to address this issue through explaining what investment banking is, introducing major investment bankers, and how investment banking affects our globally economy. Investment Banking Defined Investopedia (2008) stated this definition about investment banking, “A specific division of banking related to the creation of capital for other companies. Investment banks underwrite new debt and equity securities for all types of corporations.
Various researches can determine possible reasons as to why consumers have quite a lot of trouble making financial decisions that can be the most beneficial later in life. In the context of savings for retirement, conclusions from a test reveal that self-regulatory state, possible future orientation and more and better financial knowledge can and most likely will influence a consumers intentions for retirement investments, for example, setting up a 401K in the USA. Other studies suggest consumers who show higher amounts of future orientation are usually more likely to start up a retirement plan. Studies also show that financial knowledge and financial orientation toward ones future can help to influence the chances of one participating in a 401K plan.
In a Business Week article, Mr. Ben Steverman discuses issues facing today’s youth. The article is titles “Advice for Young Investors.” The article discuses two individuals who are 22 years of age, both are just beginning their careers. One individual is attempting to pay off student loans quickly and then save money to travel. The other individual is attempting to purchase real estate and invest within the market. Mr. Steverman discusses ten important factors for which young investors need to consider when approaching the market.
Analysis of the labor market in the economy reveals a reduction in vacancies while the number of job seekers significantly increases over the past few decades (Dickerson, 2008, p.1). Particularly, the youth employment looks worrying with a serious downward trend with so many of them unemployed. The numbers of free people who are full educated or trained have also decreased. The unemployed in the economy are either inactive or unemployed. The annual changes continue to show a rise in unemployment of young people both for student and others. With lack of government employment as well as training programs, many individuals opt to seek for self-employment (Dickerson, 2008, p.1). Statistic continues to show that there has been an increase of workless people in comparison to the vacancies available. The general picture, therefore, remains that labor market constantly fails to meet the needs of people regarding employment. Although this is the case, there has been some variation across regions with Scotland and Wales in the UK showing decreased performance. There remains a risk that employment will increase in the coming years. The present concern is long-term unemployment, specifically with regards to the youths who are most disadvantaged in the labor market (Dickerson, 2008, p.1).
The rate of unemployment for the 18 – 31 age groups nearly doubles that of the next age group comprised of their senior cohort. According to the U.S. Census Bureau, 63% of the stated young adult age groups were not employed in 2012, with this being the highest percentage in forty years (2012). Most parents have a very strong influence on the course of the career their children choose to follow. Finding employment that will support a household with established debt from college and other growing expenses has proven to be a real challenge.... ...
To increase production and sales, employers often seek workers that are more experienced. This limits the youth to a small portion of jobs. Due to their inexperience and lack of knowledge, employers do not want to spend money and time training them. But in other cases where firms accept inexperience, the pay tends to be very low, which doesn't attract them from working. The inexperienced youth pay rates range from $5-$10 per hour. But alarmingly, in part-time work the most employable age is between 15-19 years of age holding 28% of males working part-time. The employers see them as less efficient and less valuable so their pay is legally less. In some circumstances you will find that companies employ allot of the youth population, thus they can cut back on their total amount of wages they owe and earn larger profits.
Youth unemployment is a global problem facing both developed and developing economies. The United Nations define youth unemployment as individuals between the age of 15 and 24 years not employed and actively seeking employment. Statistics only consider youths who have attained the required age of employment who are willing and able to work but without jobs. Unemployment rates raise concerns in all economies. However, the rate and trends vary from one country to another irrespective of the country’s development status. For instance, in Cuba, Sierra Leone and Germany, youth unemployment rates were below 10% as per the year (Petersen & Mortimer, 2011). Sierra Leone is a developing country while Germany is a developed country yet their youth unemployment rates are comparable. On the other hand, youth unemployment rates in South Africa, Armenia and Spain were above 50% as per the year 2010 (Petersen & Mortimer, 2011). In most countries, youth unemployment rate is more than double as compared to an unemployment rate in people above the age of 24 years. Canada is not an exemption as the youth unemployment rate is raising major concerns. In the recent years, issues of youth unemployment have dominated political debates and social forums. More and more youths are leaving institutions of higher learning to end up being jobless. A considerable proportion of the youths are doing jobs that are below their level of educations. Organizations are raising standards in jobs where jobs previously performed by high school leavers are being given to diploma and degree holders. Since 1966, general unemployment rate has averaged at 7.75%. As per April this year, the unemployment rate among the youths was 14.5%, w...