The Society of Actuaries, a global professional organization, released two reports Wednesday that look at the financial challenges and perspectives on retirement planning across five generations.
The findings are based on an online survey conducted by Greenwald & Associates in July among 2,001 individual Americans: 398 millennials, 399 Gen Xers, 403 late baby boomers, 401 early boomers, and 400 from the silent generation.
The first report examines how each generation is focusing on financial priorities and preparing for financially secure retirement.
Millennials are generally struggling to establish themselves financially. This generation has a unique set of financial challenges compared to other generations, which could affect their ability to achieve a financially secure retirement.
The challenges include being able to build up an emergency fund, save for a home and pay off their credit card debt and student loans larger than those of prior generations.
Gen Xers exhibit significantly more financial confidence, with a stronger focus on saving for retirement. Few report student loans, which enables them to concentrate on longer term planning. Eighty percent of Gen X respondents reported having access to an employer-sponsored retirement plan.
Late baby boomers, the majority of whom are preparing for retirement, are the most focused on financial planning, with 51% reporting that their financial planning horizon is three or more years. These pre-retirees are targeting investments to grow their money and produce income both now and in retirement.
Early baby boomers are the most financially stable generation, with six in 10 reporting they can afford an unexpected expense of $10,000. They are also most likely to be working with a financial advisor. In addition, approximately three-quarters of early boomers report being retired.
Members of the silent generation, nearly all of whom say they are already retired, have fewer savings priorities and tend of think of their finances in terms of the rest of their lives. They are the group most likely to express a lack of financial stability, besides millennials, highlighting their overall financial vulnerability.