By Jim Poolman

The disappointing job numbers released June 1st by the Bureau of Labor Statistics only exacerbated fears of a second, “double dip” recession. Should this happen, the effect on Generation X and Y would be disproportionately severe: Gen Y graduates will have difficulty finding first jobs, depressing their earnings for years to come, while Gen Xers’ retirement savings may suffer.

Behind this short term struggle for jobs lies an even more serious long term demon: the need to amass adequate retirement savings, especially in light of the fact that the Medicare and Social Security safety nets may not exist in 20 or 30 years.

Many commentators have already noted the risk aversion of Gen X and Gen Y, a trait which can only continue to develop if the economy declines further. For example, a shocking 40% of Gen Y now responds that they will “never feel comfortable investing in the stock market” according to a recent survey. Both groups invest significantly less in the stock market than their parents did, preferring instead to increase present spending and even to save up cash reserves.

How have you reacted to the possibility of a second recession? Use our Risk Tolerance calculator to learn more about your risk personality. The calculator, which takes less than 5 minutes to complete, categorizes your attitude towards risk based on your financial instincts in uncertain times and estimates whether you are a conservative, moderate, or aggressive investor. You might be surprised at what you learn.