Millennials are a bunch of whiners, but we agree with Empower Retirement’s larger point. Whether this generation or that are better savers than generations prior or after is a tired trope meant to do little more than ramp up anxiety and scare people into a desired action.
“Americans are tired of the so-called generational wars that describe one generation as doing better or worse than another when it comes to financial planning and saving for retirement,” a new survey from Colorado-based Empower finds.
Instead, American savers want to talk about financial planning that matches where they are in life and specific milestones, like getting married, managing debt, or taking on a mortgage.
“Being a member of a defined generation does not predict financial attitudes and behaviors,” according to the survey.
Key findings of the survey
- 65% of respondents think generational differences are overstated
- 53% say their ideas and feelings about money varied greatly from life stage to life stage
- 40% identify more with others who are going through the same life events than with those in their defined generations
“It doesn’t make sense to lump an entire generation of millions of people into one group and assume they all have the same experiences or think about financial planning in the same way,” Edmund F. Murphy III, President and CEO of Empower Retirement, said in a statement. “Financial planning and goals should meet people where they are in life, consider their life experiences and personal characteristics, and then lay out a strategy that helps get them to their savings goals.”
Saving for retirement is a top financial goal across all generations, but not everyone will get there in the same way, Murphy said.
The results, published in a new paper, “It’s Not About Generations” by Empower Institute, show that experiences and economic events also shape how people plan for their futures, not the year they were born.
Events that involve unexpected loss—such as loss of a job, loss of housing, or divorce—are especially likely to result in changes, including cutting spending, dialing back on retirement contributions, and making withdrawals on retirement savings.
For example, 47% of survey respondents said they have acted with regard to their financial plans after an unexpected job loss and 41% said they took action after a loss in the 2008-09 housing market crash.
Based on this research, Empower says it’s likely that the global pandemic and its financial strain will shape financial attitudes and behaviors into the future.
“Now it becomes even more important to help Americans with a personalized, holistic view of their finances and savings goals,” Murphy concluded. “They may all be at different starting points and stages in their lives, but they do share a common goal of saving for their futures.”