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June 02, 2014 at 10:35 AM
“Modern families,” including blended and single-parent families, reported feeling less financially secure than married, heterosexual couples with children, according to a report released May 21 by Allianz.
Most respondents — 85% — called themselves middle class, a classification that has traditionally meant “they should be feeling some sense of financial security and achievement,” according to Katie Libbe, vice president of consumer insights for Allianz Life. However, 57% of modern families described their financial situation as “making ends meet,” “struggling financially” or “poor,” compared with 47% of traditional families.
There are far more modern families in Allianz’s study than traditional families. The LoveFamilyMoney study defined a traditional family as a married, heterosexual couple with at least one child. There were six distinct modern family structures in the study: multigenerational, where three or more generations live in the same household; single-parent families; same-sex couples; blended families, where a couple is married or living together with children from previous relationships; parents 40 or older with children under age 5; and “boomerang” families, where an adult child (age 21 to 35) returns home after leaving.
Less than 20% of survey respondents fit the “traditional family” definition, down from 40% in 1970.
“We decided to do a study on modern families and financial security just because the traditional family has morphed so much. The traditional family is shrinking as a kind of ‘market share’ of families, if you will, and all these other types of families are growing,” Libbe told ThinkAdvisor on Thursday. “We wanted to study some of the more interesting structures to see if they were struggling more than others.”
The study polled 4,500 online respondents age 35 to 65 with household income of at least $50,000.
Libbe said that the three modern family structures that seem to be struggling the most are the blended families, the boomerangs and the multigenerational families.
“When we dug a little further, we thought a good common denominator is the fact that there’s this disruption that occurs with an unplanned dependent: somebody moving back into the home, somebody trying to merge two families together with extra dependent, maybe having to take care of an elderly parent or something like that,” Libbe said. “It probably goes to say the more dependents, the trickier it becomes to stay financially secure, but when it’s unplanned that can be trickier.”
Same-sex couples were much more likely to report being financially secure than the other modern cohorts: 41% versus 27%. They were less likely to say they were living paycheck to paycheck or that they had to focus more on short-term issues like covering current expenses or paying off debt than on long-term planning issues.
In fact, same-sex couples were more similar to traditional families than the other modern cohorts, Libbe said. “They seem to be almost as financially secure, almost meeting their goals as much as traditional families; they just seem to be on top of it and doing the best out of all those modern family cohorts.”
