One reason for that could be that boomers have a less positive view of their parents’ retirement than their parents have, according to a NAVA press release. Sixty-four percent of baby boomers categorized their parents’ nest eggs as “modest” or “quite small.”
Only 37% of boomers surveyed said they would be very satisfied with their parents’ lifestyles, and the majority of the boomers surveyed expect a different lifestyle; with 86% of those respondents expecting it to be better than that of their parents.
Among retired parents of boomers, most attributed their retirement success to the avoidance of credit card debt (81%), the creation of an emergency fund (86%), and their ability to save enough for retirement (79%). Boomer responses indicated they are not doing as well with these actions.
According to the release, the survey found:
- Only 15% of boomers said retirement saving was the most important financial lesson they learned from their parents,
- Only 21% of boomers believe they have done an “excellent job” saving for retirement,
- Only 44% of boomers said they have done a “good job” saving for retirement,
- Only 32% of boomers said they did an “excellent job” creating an emergency fund, and
- 57% of boomers reported success in avoiding credit card debt – a 24 percentage point difference from their parents’ responses.
However, the study also found that boomers possess a more adventurous attitude that could actually benefit their retirement planning efforts in the long run. The majority is willing to consider new financial products, including annuities, to help them meet their retirement goals, NAVA said.
More specifically, 76% of boomers expect to invest more aggressively than their parents have done in retirement, and two-thirds expect to differ in their willingness to use new types of financial vehicles, with half saying guaranteed lifetime income annuities provide an “attractive” option.
The “Generational Differences in Retirement Planning (GDRP): Adult Children of Retired Parents” study surveyed more than 1,000 people age 45 to 65 about their expectations for retirement and the experiences of their retired parents. The study then compared those findings with a survey of 100 retired people age 70 to 80 regarding their views on retirement as compared with that of their adult children.
NAVA maintains an educational Web site for consumers at www.RetireOnYourTerms.com .