Baby boomers are not always associated with the concept of putting others first. Hence, their moniker, “the Me generation.”
But a new survey casts some doubt on that stereotype, with obvious implications for advisors who serve this market.
The “Lincoln Long Life Survey” published by the Lincoln Retirement Institute, Philadelphia, covers various retirement readiness issues and includes a look at the priorities of successful people in their 60s.
The main priority for this group–”family” –was at the top of the list, starting with the spouse. In addition:
o 89% of the average 60-year-old couples are married.
o Over 80% of the marrieds say they rely on their spouses for advice on figuring out joint income needs in retirement.
o 71% of respondents say they strongly considered how the surviving spouse will receive income in event of their own death.
Doesn’t sound much like the Me generation.
True, the survey does not zero in directly on boomers, allows David Kittridge, director to the Institute, which is a unit of Lincoln Financial Group. But he says advisors can use the findings to gain insight into generational issues that may be impacting boomer clients, some of whom are adult children of people in their 60s and others of whom are nearly 60 themselves.
Also, some of the issues that 60-year-olds are facing are similar to the ones that boomers will be, or already are, encountering, he says.
For example, Kittridge says, “my own parents are in their 60s, and they like to stay connected. I’m a boomer, so it [involvement in the family relationship] is part of my family dynamics.”
This connectedness will continue for most boomers, provided they are willing to interact with that lifestyle, he says.
Also, the younger boomers whose parents are in their 60s will be learning from their parents, how they age and go through retirement challenges.
All of this has financial implications, Kittridge stresses.
The interest in family and personal relationships is pronounced. For instance, the survey found that 59% of the “successful 60s,” as the survey labels the respondents, visit family more than once a week. And 83% say it is extremely or very important to be respected by family and friends.
(Note: In the survey conducted by Mathew Greenwald & Associates, Washington, the “successful 60s” comprise a random group of 500 people with annual household income of $75,000+ and household assets, excluding real estate, of $300,000+.)
The relationship orientation of the successful 60s involves more than caring about family and friends. Many of these individuals also are experiencing intergenerational squeeze, says Kittridge.
For example, a large number of the 60-year-olds, 62%, provide “significant financial support” to relatives. And, 94% of those with a parent or in-law living in the home identify themselves as the “sole supporter” or “heavy financial contributor” to that in-law. Over half (54%) say they are the sole financial supporter of at least one child or stepchild, and another 30% are heavy contributors.
“Without financial wherewithal, financial solutions can’t be achieved,” Kittridge says.
The boomer children of those 60-year-olds may soon find themselves experiencing the same sort of pressure, being squeezed by the needs of their own parents and of their own adult children, he continues.
“Even if a boomer has an ‘I care about me’ attitude, the boomer’s children may expect it,” Kittridge cautions.
That is, the children, having witnessed how the 60-year-olds responded to the squeeze, may expect their own boomer parents to respond similarly to the family’s intergenerational needs.
Is this showing up in client interactions with advisors? “Yes,” says Michael Byrne, a financial advisor with Lincoln Financial Advisors, Cherry Hill, N.J. “Being close to the children and grandchildren is very important, especially for the wife.”
In fact, many of his clients have packed up and moved to Florida for their retirement, only to pack up again and move back home–to be near the family, he says.
“It’s gotten to the point that we now counsel people who go to Florida to rent there first. Then, they can decide if they want to stay or come back.”
Because relationships are so important to many boomers and older clients, Byrne says his firm routinely builds flexibility into the financial plans of those clients. This can show up in plan design, cost structure, options and other areas, to enable clients to respond to family needs as necessary.
Some 50- and 60-year-olds have grown children who are still dependent on them, he notes (a trend that the survey also caught).
“As a result, we often build a ‘subsidy’ for the adult kids right into the plan.” That subsidy might be used to pay for a child’s apartment, pay the child’s gas, and so on.
“It’s love for the child” that sways these clients to want to help their children financially, Byrne says.