Americans of All Ages Facing Financial Challenges
A new study reveals that Americans of all ages are facing significant financial challenges in both the present and the future. Millennials, Generation X and Baby Boomers each face their own “pain points” for financial health, but all have long-term money management issues.
According to the 2014 Generational Research from Financial Finesse, Millennials are focusing more on current debts than they are on future retirement plans. The average student loan balance in America is now over $25,500, a 60% increase from 2005. Only 27% of Millennials run a retirement calculator to make sure their savings are on the right track, and just 83% participate in an employer-managed 401(k) plan–the lowest percentage of all generations. The percentage of Millennials having an emergency fund to cover unexpected expenses or pay bills if they lost their job has declined from 54% in 2011 to 47% in 2014.
Generation X reports the highest levels of financial stress, with only 68% saying they have a handle on their cash flow. Just 17% feel they are on the right track for retirement, and 13% admit they cannot pay their bills on time every month. One in four Generation X participants in the survey say they have “high” or “overwhelming levels” of financial stress.
The Baby Boomers are primarily focused on retirement, with 93% saying planning for retirement is their top financial priority. Nevertheless, 10% of Baby Boomers do not believe they will ever be able to retire, and 62% say they have not saved enough money to retire. Only 16% of this generation has long-term care insurance, even though the Department of Health and Human Services estimates that 70% of people over the age of 65 will need long-term care at some point.
The financial stress points that impact each generation are alarming. Americans must do a better job managing their money in the present and preparing for their financial future in order to improve the overall economic stability of the United States.