For generations, retirement has been a financial goal that virtually everyone has had to think about. Although this has been a constant fact, the way Americans think about retirement and retirement savings has changed considerably. Members of the Baby Boomer generation have thought about retirement as a saving process that starts early and grows in value through personal contributions, employer contributions and investment.
Millennials – those young adults just now graduating college and entering the workforce – see retirement in a very different light.
Documenting a Change in Attitudes
Recent statistical data reveals some intriguing patterns regarding the attitudes of Baby Boomers versus the attitudes of Millennials when it comes to retirement, college education, homeownership and other major financial concerns. In many ways, we are seeing an inversion of thinking regarding retirement and about financial planning in general. For instance, data collected found that:
- A majority (28.7 percent) of Baby Boomers purchased their first home between 18 and 25 years of age; a majority (32.2 percent) of Millennials purchased or planned to purchase their first home between 25 and 30. Roughly 24 percent of Millennial responders said they purchased or planned to purchase their first home at 30 – 35, while only 22% said they had or would become homeowners at 18 – 25.
- Only 25 percent of Millennial respondents said they relied on a financial planner for information regarding retirement saving; this is in comparison to 35.1 percent of Baby Boomer respondents, who utilized the services of financial planners more than any other informational source.
- Baby Boomer respondents overwhelmingly plan not to relocate for retirement (37 percent); on the other hand, the majority of Millennials (32.1 percent) had not even thought about where their retirement years might take place.
Attitudes about education between these two demographics vary in interesting ways, too. While respondents in every earning bracket ($0 – $24,999, $25,000 – $49,999, $50,000 – $74,999, $75,000 – $99,999, $100,000 – $149,000, and $150,000+) strongly stated that education was an essential part of career success, this was overwhelmingly so for Millennial respondents.
For instance, Baby Boomers in the lowest earning bracket were nearly evenly divided over whether a college education was very important or not very important at all (30.3 percent and 29.9 percent respectively). Half of Millennials respondents in the same earning bracket, said that college education was critical to their career success (50.3 percent). This pattern played out across nearly all other earning brackets.
Why Have Attitudes Changed?
A review of the findings suggests interesting conclusions about the priorities and ambitions of these two different demographics. However, given that Baby Boomers have already seen for themselves what effect choices like college education and homeownership have had on their lives, we should not be too hasty in making definitive statements about exactly why attitudes are so different.
Millennials are only barely starting to see the long-term implications of their financial decisions. If we came back to the same group of respondents in a few decades, we might see attitudes shifting to look more like their parents’ – or we might not.
For the time being, the assistance of financial planners is still going to be essential for Millennials thinking seriously about their financial future. They are actually thinking about work, but in a very different way that other generations do or did; technology is their greatest skill, they are critical, constantly connected with the society and the world. They need constant feedback, speed, connections and that’s how their achievements and success get valuable.
We definitely think that generations, are in constant movement and changing really fast. We are living in a fast present and fast future age where adaptability, is an essential, as aspects like self-actualization and mind development are the key to productivity.
So, which generation do you actually belong to? Baby Boomers, Generation X or to the famous Millenials?
Featured photo credit: Retirement via ilr.cornell.edu