Tag Archives: Baby Boomers

Generational Attitudes about Retirement

Attitudes about retirement vary from one generation to the next.

That stands to reason. For Millennials (those born from 1979–2000), retirement is a long way off. For Generation X (born 1965–1978), retirement isn’t too far down the road, while millions of Baby Boomers (born 1946–1964) are already retired.

Generational Attitudes on RetirementA number of recent studies have tracked generational differences concerning retirement, but they also show a substantial amount of agreement among the generations. Surveys show that a majority of workers, regardless of generation, are saving for retirement. But Millennials appear to be outperforming members of the older generations on that count. They tend to start saving early and are on track to outpace Boomers and Gen Xers in building retirement nest eggs.

Concerns about Social Security are high across generations, with many fearing that it won’t be there for them when it comes time for them to retire. (That fear is reasonable, though perhaps exaggerated, based on Social Security Administration projections.)

Social Security’s troubles, plus the general decline of defined-benefit pensions, has left many feeling that they are on their own. According to one report, two-thirds of both Millennials and Gen-Xers expect their retirement savings accounts to be their primary source of income after they stop working.

The take away for NYSLRS members? The cross-generational anxiety about retirement underscore the important role that a defined-benefit retirement plan, such as your NYSLRS retirement plan, plays in securing your financial future. It also reinforces the importance of saving for retirement.

Gen X Struggling with Retirement Security

Generation X turns 50 this year and according to a survey by AARP, they may be more anxious about retirement than Baby Boomers. Gen X has been feeling the pinch for a while. They’ve seen the rise of 401(k)s replacing traditional pension plans and have the added burden of taking care of their children and aging parents. Even though Gen Xers have “more time” to plan, the biggest concern among them is not saving enough for retirement. The survey, High Anxiety: Gen X and Boomers Struggle with Stress, Savings and Security, looked at New York voters from age 35 to 69. And as the survey shows, anxiety is running high in Generation X: This lack of retirement confidence could stem from several reasons. In New York, 20 percent of working Gen Xers don’t have access to a workplace retirement savings plan. Because of this, 31 percent of Gen Xers without access aren’t confident they’ll ever retire. If their employer offered a plan, 80 percent stated they’d be likely to use it. But even out of those with access, 37 percent aren’t saving for retirement through a workplace plan. Many Gen Xers also cite their current expenses as an obstacle to saving for retirement:

  • 59 percent say they have no money left after paying for bills.
  • 56 percent are paying for their children’s education.
  • 44 percent have lost a job or taken a pay cut.
  • 44 percent have too much debt to pay off.
  • 37 percent are caring for an elderly parent or relative.

AARP Proposes State-Run Retirement Savings Program

In May, AARP reported on the findings of this survey at a retirement readiness event in Albany. “We know Boomers are worried, but the fact that Generation Xers are even more worried is cause for alarm and reflection,” said Beth Finkel, the state director of AARP in New York. “Since an uncertain financial future for New Yorkers is an uncertain financial future for the state, it is vital that these worries be addressed.” Americans are 15 times less likely to open a retirement savings plan on their own compared to if their employer offered one. To help address this and other concerns, AARP is calling for a state-sponsored retirement savings program. Deputy Comptroller Thomas Nitido represented NYSLRS at the event. He agreed that such an system could be useful, but workers would still face the challenge of finding extra money to put aside after paying bills. He also said that New York State Comptroller Thomas P. DiNapoli would prefer to see a federal solution to the retirement issue. However, that was “unlikely” given the political mood of the U.S. Congress.