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Financial Planning > Tax Planning

But Show More Financial Sophistication With Their Own

By Staff Writer

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But Show More Financial Sophistication With Their Own

There are signs of increased financial sophistication among baby boomers compared to 10 years ago, according to the latest AXA Nest Egg Study. Fewer boomers cited balancing savings and financial security as their single greatest financial concern (9% in 2003 vs. 17% in 1993), indicating that they had this area of finances under control.

Almost all, and more than in 1993 (90% now and 81% in 1993), indicated that they intend to live within their means and depend less on credit in the future.

They are using more sophisticated financial vehicles. The usage of IRAs as a primary investment has risen strongly, (40% in 2003 and 17% in 1993), while reliance on CDs and money market accounts went down to 14% from 23% in 1993. The second most frequently mentioned primary investment vehicle is mutual funds (44%) and a third tier includes life insurance and individual stocks and equities.

“These findings seem to indicate baby boomers are seeking wiser investments for savings–vehicles that offer diversity, long-term growth potential and tax-deferred benefits,” says Christopher Condron, president and CEO, AXA Financial.

The study was conducted by Mathew Greenwald & Associates in August 2003 and polled 701 baby boomers with annual household incomes of $75,000 and above.

Reproduced from National Underwriter Life & Health/Financial Services Edition, February 20, 2004. Copyright 2004 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.

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