Financial differences of each generation vest 2017

1. The Financial Differences of Each Generation 2017 Sponsored by

2. The Financial Profile of Generations
Millennials Gen X Baby Boomers
1 2 3
Every generation has a unique financial profile. These profiles represent a particular set
of challenges and opportunities for companies and advisors to consider.
Through this report, we look at the key financial differences between each generation
of employees.

3. Millennials: Crushed by student debt, budgeting troubles,
and not enough retirement contributions
Millennials Gen X Baby Boomers

4. The
average
Millennial
has $33k
in student
loans
Source: PEW Research Center, Millennials in Adulthood
Millennials Gen X Baby Boomers

5. 63% would have
difficulty covering an
unexpected $500
expense
Nearly 30% are
overdrawing their
checking accounts
53% carried over a
credit card balance in
the last 12 months
53%30%63%
Source: Gallup, At what age do you expect to retire?
Millennials often struggle with personal
finance foundations
Millennials Gen X Baby Boomers

6. Source: Vanguard, How America Saves Report
Millennials Gen X
1 in 2 millennials are not contributing towards retirement
Baby Boomers

7. Source: Vanguard, How America Saves Report, Nerdwallet Investment Returns
25 - 34 35 - 44 45 - 54 55 - 64 65+
5.3%
6.3%
7.2%
8.7%
10%
Average Annual Retirement
contribution by age
4.3%
< 25
At this rate, there is an 80% gap for millennials to retire well
The ones who do contribute are contributing at the
lowest rate across all generations
Millennials Gen X Baby Boomers

8. Source: Jobvite Job Seeker Nation Study 2016,
The ones that don’t cash out don’t aggregate
their accounts, so they have no grasp on
how much money they truly have
When they leave their jobs, many cash out
on their retirement account they have been
accumulating money in, and incur a penalty
This is no education being provided to millennials on how to
manage their retirement accounts
42% of the millennial workforce change jobs every 1-3 years,
compared to just 18% of the rest of the workforce
Millennials Gen X Baby Boomers

9. Generation X: More family to support than other
generations, worried about retirement, and under-insured
Millennials Gen X Baby Boomers

10. Have saved less
than $10k
Don’t have
retirement savings
Have saved
$10k - $49k
Have saved
$50k +
Source: GoBankingRates Retirement Survey
30% 22% 11%
63%
37%
Millennials Gen X
Gen X is not saving enough for retirement at the
time when they need to be saving the most…
Baby Boomers

11. …And they are under-insured
Only 54% hold long-term
disability insurance at a time
in life where they are most
likely to have kids at home
Only 23% of Gen Xers have
prepared legal documents such
as a simple will and have made
guardianship provisions for
minor children
Slightly more than half
carry enough life
insurance to replace
70%-80% of their
income
Source: Financial Finesse, Generational Research 2016
Millennials Gen X Baby Boomers

12. The Sandwich Generation
Stuck with having to
support kids with high
student debt AND
parents who face
stagnant social
security income
This often requires
them to dip into their
own retirement
savings to help
support family
Source: Bank of Montreal 2015
Millennials Gen X Baby Boomers

13. Baby Boomers: Rising healthcare costs, retiring later and
being unprepared
Millennials Baby BoomersGen X

14. Healthcare costs for Baby Boomers are
significantly higher
19 – 34 35 - 44 45 - 54 55 - 64 65+
$1,776
$2,193
$2,740
$3,734
$4,613
33%
increase
Annual Medical Costs of Low Risk
Individuals vs Age
A direct relationship exists
between increasing age,
increasing health risks,
and the associated
medical costs
Source: Edington. AJHP. 15(5):341-349
Millennials
Baby
BoomersGen X

15. They are retiring later than previous
generations
50%
0%
25%
1996 2015
At what age do you expect to retire?
(asked of non-retirees)
% Under 65
% Over 65
Nearly 4 in 10 non-
retired Americans
expect to retire after
age 65
Source: Gallup, At what age do you expect to retire?
Millennials Gen X Baby Boomers

16. Baby Boomers are underprepared for
retirement
Source: GoBankingRates Retirement Survey
28% of Baby Boomers have zero retirement savings
Millennials Gen X Baby Boomers

17. An estimated $30 trillion in assets will be transferred from Baby
Boomers to future generations over the next 30 - 40 years
There are many critical estate planning decisions that need to be
made about the future of their money, and what the future
generations will then do with it
Source: FTI Consulting Survey 2010
As “The Great Wealth Transfer” nears, many
questions are still unanswered
Millennials Gen X Baby Boomers

18. If you would like to learn how
Vest can help you…
prepare your employees for retirement…
achieve financial wellness...
and make a difference to your bottom line...
let’s chat.
www.wearevest.com
Schedule your demo today