According to an April 2016 employee financial wellness survey, baby boomers (50%), Gen Xers (56%), and millennials (60%) share the same top financial concern about not having enough emergency savings for unexpected expenses. Following are additional financial concerns for each group and some tips on how to address them.
Baby boomers cite retirement as a top concern, with 45% of the group saying they worry about not being able to retire when they want to. Although 79% of baby boomers said they are currently saving for retirement, 52% of the same group believe they will have to delay retirement. Many baby boomers (23%) are delaying retirement in order to retain their current health-care benefits. Other reasons for delaying retirement include not having enough money saved to retire (48%) and having too much debt (23%).
Gen Xers are worried about running out of money in retirement, with 50% of those surveyed naming this as a top concern. More Gen Xers (26%) than baby boomers (25%) or millennials (21%) have already withdrawn money held in their retirement plans to pay for expenses other than retirement.
Besides worrying about retirement, 25% of Gen Xers are concerned about meeting monthly expense. Forty-four percent find it difficult to meet household expenses on time each month, and 53% consistently carry balances on their credit cards.
Being laid off from work is another financial worry among Gen Xers, cited by 22% of those surveyed — more than cited by baby boomers or millennials.
Millennials seem to be more concerned about meeting current expenses, with 35% naming this a top worry. Millennials are also finding it increasingly difficult to pay their household expenses on time each month (46%).
Considering the amount of debt millennials owe, it’s probably not surprising they worry about making ends meet. Specifically, 42% of the millennials surveyed have a student loan(s) with, 79% saying their student loans have a moderate or significant impact on their ability to meet other financial goals.
In an attempt to make ends meet, 30% of millennials say they use credit cards to pay for monthly necessities because they can’t afford them otherwise.
How each generation can address their concerns
Focusing on some basics may help baby boomers, Gen Xers and millennials address their financial concerns. Creating and sticking to a budget can make it easier to understand exactly how much money is needed for fixed/discretionary expenses as well as help keep track of debt. A budget may also be a useful tool for learning how to prioritize and save for financial goals, including adding to an emergency savings account and retirement.
At any age, trying to meet the competing demands of short-and long-term financial goals can be frustrating. Fortunately, there is still time for all three generations to develop healthy money management habits and improve their finances.
FRANK MOKOSAK, CFP® is a Principal and Investor Coach at Mokosak Advisory Group. Frank has more than 20 years of experience as a financial coach. Frank is very detail oriented, with an innate talent for creating strategies, research and building professional relationships with clients. He focuses on the needs and goals of clients without having to fit them into a limited box of investment products. Investment coaching is of greater benefit to clients, and is more satisfying for Frank.
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