This bank CEO isn’t like the other girls, or at least he doesn’t want you to think so, because he claims he knows his customers are in trouble. “In many ways, someone today making over $100,000 is really struggling to live the American Dream for a variety of reasons, and they need a relationship bank,” said Anthony Noto, Chief Executive Officer. of SoFi Technologies, at a JPMorgan investor conference. this week.
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Citing the high price of going to college, Noto says many workers graduate and “are going to be in a hole and they can’t invest.” He’s not wrong. The price of higher education puts younger generations off on the wrong economic footing, so to speak, preventing them from building wealth and reaching the same financial milestones as earlier cohorts.
“If they buy a house that is too big for their means, they won’t be able to save and they will constantly go over budget,” he adds, explaining that this is where his company would like to step in. to help these people invest. To be fair, the fintech company executive saw SoFi as the solution to many (or all) of these problems.
As a giant in the fintech space, straddling the line between financial services and an app, SoFi is active in student and personal loans, generating billions every quarter, but as Motley Fool notes, the market seems skeptical. . Its stock is up about 10% this year, but that’s less than half the rise of the Nasdaq Composite, a benchmark for tech stocks.
And about that American dream inaccessible because of student loans, Noto’s company has sued the government in order to try to stop the pause on student loans, as it is an important part of his business. “SoFi’s attempt to end the suspension of student loan payments and force millions of Americans to repay while amassing massive revenue and handing out huge paychecks to executives represents the worst of corporate greed. businesses,” Congresswoman Ayanna Pressley (MA-07) and Senator Elizabeth Warren (D-MA) said in a statement in April.
Yet there is an underlying truth to Noto’s words. During a period of high inflation, many individuals, especially younger people who are more affected by market volatility and who are more indebted, realized that the American dream was no longer accessible or affordable. Wages are not keeping pace with inflation, which has a greater impact on those in entry-level jobs. All of this has led to many millennials sounding a bit like a SoFi Technologies guy, declaring that a low six-figure salary is no longer the goal. It’s easier to see savings being squeezed even with a $100,000 annual salary, as a Morning Consult survey showed that households earning more than $100,000 a year experience the biggest drop in financial well-being compared to a year ago.
It doesn’t help that the hallmarks of the fabled American dream were buying a house and eventually retiring, things that were always quite difficult but started to be trying for today’s young people who are struggling with a little more financial insecurity. Aging in a tough housing market, some Gen Z and Millennials depend on their parents to get by and pay their bills. The bench position for retirement has also changed, as experts now predict that even $1 million is too low for a comfortable retirement.
Even over $100,000 seems paltry to Americans like Noto. “Compared to previous generations, $125,000 doesn’t seem like enough anymore,” said Kelly, 29, who works in tech. The wealth Alicia Adamczyk, “My parents, they raised four kids on this. I expected that when you earn all that money, you could live a comfortable life.
And a majority (61%) of Millennials and Gen Z told the banking app Dave and Harris Poll in 2022 that they weren’t confident in their ability to achieve their goals. It’s gotten to the point where many don’t think they can afford their dream futureAmerica’s dream or not.
This story was originally featured on Fortune.com
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