Three out of four Gen Xers and Gen Yers said saving for retirement is a personal financial goal, and an overwhelming majority (92 percent) feels that they can achieve their most important financial goals in the next 10 years.

However, many younger Americans grade themselves poorly when it comes to saving money (42 percent gave themselves a D or F) and investing their money outside the workplace (47 percent gave themselves a D or F).

These findings are from a joint report from the American Savings Education Council and The Divided We Fail group -- comprised of AARP, Business Roundtable, National Federation of Independent Business and the Service Employees International Union -- titled "Preparing for Their Future: A Look at the Financial State of Gen X and Gen Y."

While 86 percent of Gen Xers and Gen Yers know they should be more prepared for a "rainy day," many report that they know more about their iPod (40 percent very knowledgeable) than they do about filing their taxes (26 percent), buying a home (21 percent), investing outside of work (15 percent) and saving for retirement (15 percent).

Young people place a high value on benefits in the workplace such as health insurance (94 percent), retirement savings plans (88 percent), matching or contributing to a retirement savings plan (89 percent), wellness plans (78 percent) and offering financial education/advice (77 percent). While they may look to the workplace for tools, 70 percent of Gen Xers and Gen Yers look to their parents for personal finance advice and guidance.

"These generations face new challenges when it comes to building lifetime financial security," said Nancy LeaMond, executive vice president of the AARP's Social Impact unit. "The good news is that they realize how the retirement landscape is changing and are confident that they can achieve their financial goals, the bad news is that they know more about making their iPod work than making their savings work for them."

An online survey of 1,752 young people was conducted in early 2008. For the purposes of this report Gen X includes those respondents ages 28 to 39 years old (born 1968 to 1979) and Gen Y includes those between the ages of 19 and 27 (born 1980 to 1988).