Every generation has its own money problems.What are they doing to fix them?
Baby Boomers can claim bragging rights for financial wellness, while previous generations struggle with savings and debt issues following the 2008 financial collapse. These are the findings of a new report released by Financial Finesse, a provider of workplace financial wellness programs in the U.S.
The annual study finds that every generation has their own money problems. Baby Boomers, overall, are the most financially secure compared with Millennials and Gen Xers, but many are delaying retirement due to insufficient savings. They also face looming health care concerns due to increased longevity and inadequate insurance planning. Only 16 percent report having long-term care insurance.
Millennials, the report finds, are doing reasonably well with day-to-day money management, but rather than focus on growing their wealth, they have prioritized “not losing money” and paying off their massive student loan debt.
Gen Xers, hit hardest by the worst financial crisis since the Great Depression, are deemed the most at risk with “high levels of financial stress.” Nearly one-fourth are contributing to a college savings vehicle, but only 17 percent are on track for retirement.
Across the generations, Baby Boomers express the most confidence in their financial knowledge and money management acumen. Eight-in-ten self- report a good handle on their cash flow so they spend less than they make each month. In comparison, 72 percent of Millennials and 68 percent of Gen Xers answered similarly.
Seven-in-ten Baby Boomers report having an emergency fund, compared with half of Gen Xers and 47 percent of Millennials, while Baby Boomers are most likely (95 percent) to report paying their bills on time each month (vs. 90 percent of Millennials and 87 percent of Gen Xers).
In terms of retirement planning, all the generations equally contribute to a traditional or ROTH IRA as well as capture the company matching funds in their retirement plans. But while eight-in-ten Millennials are contributing to their workplace retirement plan, that is not as diligent as Gen Xers (89 percent) and Baby Boomers (93 percent).
Gen Xers, the report finds, “face significant financial challenges, largely due to competing financial priorities, such as funding their children’s education and preparing for their own retirement.” They are most likely to describe their financial stress level as “high” (20 percent) or “overwhelming” (6 percent). Nearly half (47 percent) cite not being able to reach their financial goals as the cause of their financial stress.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.