Baby boomers today are feeling financially prepared for retirement, Allianz Life reported Monday.

Not only that, more boomers think they can determine their post-work expenses and have the tools to figure out the retirement puzzle.

A report early in the summer said American workers’ readiness for retirement compared favorably with that of foreign peers.

Allianz Life acknowledged in a statement that 63% of Americans fear running out of money in retirement more than they fear death, but said its research showed that boomers were exhibiting a new optimism.

Other recent research found that middle-income boomers were unsure about their prospects for a secure retirement.

Larson Research + Strategy conducted the online survey in May with 3,006 U.S. adults ages 20 to 70 with a minimum household income of $30,000.

Seventy-two percent of boomers in the poll said they felt financially prepared for retirement, up from 58% who said this in 2010.

In addition, only 32% of boomers said uncertainty about their financial future made it hard to know when they could stop working, compared with 50% who said they were unsure about when they could retire, if ever, in 2010.

Other positive indicators: Half of boomer respondents considered it “impossible” to determine retirement expenses, down from 60% in a 2014 study, and 36% thought they lacked know-how to figure out the retirement puzzle, down from 46% in the same study.

“The Generations Ahead Study highlights encouraging news for boomers and proves that with proper focus and engagement, anyone can turn around a poor savings situation and start building for a successful retirement,” Paul Kelash, vice president of consumer insights for Allianz Life, said in the statement.

“Whether taking lessons from the past or forging a new path, the key for each generation is to recognize that a solid retirement plan doesn’t happen by chance, but rather with a clear process and defined actions.”

What’s leading to boomers’ stronger sense of financial preparedness and confidence?

A new frugality has taken hold, according to the study. Sixty-four percent of respondents said they were “savers” rather than “spenders,” and 61% said they knew precisely how much money was in their accounts.

A quarter of these thriftier boomers described themselves as “penny pinchers.”

As a result, more boomers are thinking seriously about saving for retirement, the study found. Sixty-five percent said they considered it a basic necessity, like food or housing. This compared with 58% of millennial respondents and 53% of Gen Xers.

Boomers’ new frugal mindset has helped bolster their bottom line, according to the study. Boomers have the highest median amount in retirement savings among all generations at $175,000.

A third of boomers reported that they had $250,000 or more earmarked for their retirement years.

Allianz Life noted that boomers’ optimism about retirement has implications for the advisor-client relationship.

Millennials’ Leg Up

Millennials are also saving successfully, more so than their Gen X counterparts. Both generations face financial challenges, but millennials appear to be better positioned for retirement.

Recent research found that millennials understood that they had to take responsibility early on for retirement saving and were also demanding more choices of investments and employers.

According to the Allianz Life survey, both millennials and Gen Xers have the same median amount in retirement savings, a meager $35,000, even though the latter are much closer to retirement.

The results showed that millennials more closely mirrored boomers’ perspective on retirement, while Gen Xers felt more vulnerable:

Feeling prepared for retirement

  • Millennials, 74%
  • Boomers, 72%
  • Gen Xers, 63%

Confidence that income will last a lifetime

  • Millennials, 76%
  • Boomers, 67%
  • Gen Xers, 58%

Allianz Life noted, however, that millennials also exhibit some worrying behaviors. Unlike boomers who tout their saver status, 63% of millennials claimed to be “spenders,” and 17% acknowledged that they spent money “as soon as I get it” — only 6% of boomers admitted they were spendthrifts.

Moreover, half of millennials said they spent more on going out than on mortgage or rent, compared with 16% of boomers.

New Strategies, Lessons Learned

The good news is that new savings strategies and a desire to avoid repeating their parents’ mistakes have influenced millennials’ retirement readiness.

Seventy percent of the youngest survey respondents said they had embraced online apps to help manage money and/or track spending, compared with just 24% of boomers.

And where technology fails, 63% of millennials were happy to use traditional money management methods, such as a notebook or planner, to manage expenses, versus 28% of boomers.

Millennials were also more than twice as likely as boomers to trick themselves into saving money, such as setting up different accounts for different goals.

The study found that millennials had adopted a more proactive approach with money management in the belief that their parents had made financial mistakes and that they could do better.

Two-thirds said they were “much better with money” than their parents and were uncomfortable with debt because they had seen their parents struggle with it.

What this comes down to is that 78% of millennials were confident they would be able to fund their life goals, compared with 67% of boomers and 64% Gen Xers. One-quarter even felt “extremely confident” they would be successful.

“Although generations share similar hopes and fears for the future, the fact that they all approach retirement in different ways is testament to the need for more tailored planning that can address both the positives and negatives inherent in each group,” Kelash said.

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