Financial Perspectives on Aging and Retirement Across the Generations
The Society of Actuaries’ Aging and Retirement Strategic Research Program recently released the results of a study focused on the financial perspectives of aging and retirement of Americans across five generations, including Millennials, Gen X, Early Boomers, Late Boomers and the Silent Generation. In addition, the study, a follow-up to a survey conducted in 2018, seeks to understand how the habits and behaviors from earlier in life played out in the later years of retirement.
The Top 10 Findings are listed below from this May 2021 updated survey conducted by Greenwald Research.
- The impact of the COVID‐19 pandemic has been uneven: 36% of respondents say the pandemic negatively impacted their overall financial situation while 14% say the impact on their finances was positive. While all generations say they reduced spending as a result of the pandemic, most have not taken other financial actions.
- Job disruption as a result of the pandemic is most common for Millennials, with 4 in 10 experiencing job loss or a pay decrease. This is true for 33% of Gen Xers and 21% of Late Boomers.
- 35% of workers have changed or considered changing when they plan to retire as a result of COVID‐19 with most of these respondents delaying their retirement.
- Worries about climate change impacting retirement is a highest among Millennials. They are more likely to believe climate change will impact their health, increase the likelihood of damage to property, and influence where they will live in retirement.
- For most potential retirement risks, the levels of concern are greatest with the younger age groups. But younger generations are also more likely to have the shortest planning horizons. The pandemic does not seem to have caused a significant increase in level of concern around retirement risks in general, but many are worried about the impact the pandemic will have on their retirement savings.
- Since the beginning of the pandemic, 2 in 10 experienced changes to their living situation — with housing change being more common for younger generations. 10% of Millennials and 7% of Gen Xers had trouble with their mortgage or rent payments.
- 6 in 10 say the pandemic has negatively impacted their overall feeling of well‐being. Feelings of loneliness and isolation are more prominent among Millennials despite — or perhaps because of — higher use of social media and video calls to connect with family and friends.
- Families help each other out financially: a third have provided financial support to a family member and 16% have received support in the past year. Younger generations are more likely to find providing this support stressful. Additionally, 28% are now more concerned their adult children will need financial help. 20% feel the same about their parents needing support.
- Debt is complicating the finances of about half of Millennials and 35% of Gen Xers — higher than the rates of Boomers and the Silent Generation. The stress that stems from having debt is also highest among younger generations.
- There are significant differences in how men and women view their financial situation. Men are more likely to say they feel optimistic, in control, satisfied, happy, or smart while women more often cite feeling overwhelmed, and depressed. These differences are most pronounced in the Boomer and Silent generations.
If you would like to read the full report, you can visit the Society of Actuaries© website for more information.