Millionaires worry more about the financial well-being of their children than they do about their own finances. Here’s why.
Millionaires tend to worry more about their financial well-being of their children and grandchildren than they do about their own financial security. A new study from the Urban Institute tells us why.
The economic crisis has produced a “lost generation” of young adults who’ve been unable to build wealth compared to their parents 25 years ago. Members of Gen X and Gen Y are 7 percent less wealthy than their counterparts in the 1980s due to “stagnant wages, diminishing job opportunities and lost home values,” according to the Urban Institute report.
Learn more about the family concerns of America’s Millionaire investors.
The trend has long-term implications. Difficulty accumulating wealth as a young adult dim the chances that members of Gen X and Gen Y will achieve financial security in retirement.
Retirement advice tops the agenda of young investors.
The outlook is distressing to parents who dreamed their children would enjoy a better life and discouraging to younger generations who hoped to become wealthier than their parents. The sentiment is based on the expectation that as a society becomes wealthier, younger generations will become richer than previous ones. Until recently U.S. history has borne out this trend. Early baby boomers – those born from 1943 to 1951 – are wealthier than Americans born from 1934 to 1942, who are richer than individuals born from 1925 to 1933. The trend begins to reverse for younger baby boomers – those born starting 1952, the report said.
The housing crisis – which disproportionately impacted more recent home buyers – contributes to the problem. Increasing student debt levels - and lower levels of educational attainment - have also limited the upward mobility of young adults. The prospect of heavier tax burdens also threatens to erode the ability of young adults to save for the future.