Perspectives of Millennial and Boomer Women: Who s Better Off?

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1 Perspectives of Millennial and Boomer Women: Who s Better Off? Karen Wimbish Retail Retirement June 10, 2014

2 About the Survey Who between the ages of 22 and 33 Baby Boomers between the ages of 49 and 59 US residents who are primary or joint financial decision makers What Asked about current situation, work/career/ education, retirement and personal finances How/When 1,639 surveyed from the Ypulse and Research Now online panels 1,529 Boomers surveyed from the Research Now online panel April 15 May 2, 2014

3 Big Lesson from the Great Recession 80% of and 83% of Boomers say 2008 recession taught them to save now to survive problems down the road 2

4 3 How Many Are Saving? Have You Started to Save for Retirement? Among Non-Retirees 45% No 55% Yes Retirement Fund 18% No Boomers 82% Yes Retirement Fund 82% of Boomers are saving for retirement as compared to 55% of

5 Debt is Overwhelming for Boomers 4 in 10 are overwhelmed with current amount of debt (39% compared to 23% of Boomers) 39% 23% 4

6 Millennial and Boomer Estimates of Debt as a Percentage of Income Mean % of Monthly Household Income Going to Paying Debt 47% Medical debt Credit card / Personal loan debt Auto loan Student loans/ Education expenses Mortgage of pay half or more of their monthly income, on average to servicing debt Boomers 43% Medical debt Credit card / Personal loan debt Auto loan Student loans/ Education expenses Mortgage of Boomers pay half or more their monthly income, on average, to servicing debt Q1124 5

7 6 are Less Satisfied than Boomers with their Levels of Savings and Debt % Very/Somewhat Satisfied Boomers 54% 67% 49% 58% Debt levels Savings levels

8 are More Optimistic and Confident than Boomers Boomers I feel better off financially than others in my generation 62% 69% I am or will be better off financially after getting married/partnered 60% 67% Current salary is not what I expected, but I am confident that in a few years I will be earning what I should be 40% 67% In control I have the skills to succeed in my career goals 79% 84% Confident my career will advance 53% 84% Confident I have/will be able to save enough to afford the lifestyle I hope to have for my future self (% Confident) My standard of living is better than that of my parents (% Confident) 72% 64% 68% 58% If I lost my job this year I could find a comparable on within a year (% Confident) 58% 78% Q1107 / Q1111 / Q1147 / Q1148 / Q1120 7

9 The Biggest Triggers to Start Saving for Retirement are the Same for and Boomers % Strongly/Somewhat Agree (of those saving for retirement) Boomers Realized that starting early can result in a bigger nest egg down the road My company offers a workplace retirement plan The match on my contributions to my workplace retirement plan I started earning enough money to allow me to save A significant life event (e.g., got married, had children) prompted me to think ahead My parents suggested it A friend or work colleague told me that I should start saving 25% 23% 23% 23% 19% 25% 15% 14% 8% 11% 7% 2% 3% 1% Q1134 8

10 More than Half of and Boomers Think They Will Need Under $1 Million for Retirement The Retirement Number Among Non-Retirees who could estimate (excludes outliers) Boomers < $100K 16% < $100K 8% $100K - $499 20% $100K - $499 21% $500K - $999 17% $500K - $999 27% $1 mil - $1,499,999 $1,500,000 - $1,999,999 16% 8% $1.83 million Average Retirement Fund $ $1.42 million Average $1 mil - $1,499,999 $1,500,000 - $1,999,999 21% 6% $2,000,000 - $4,999,999 15% $2,000,000 - $4,999,999 13% $5,999,999 - $9,999,999 4% $5,999,999 - $9,999,999 3% $10 mil or more 4% $10 mil or more 2% 40% of could not estimate their retirement number 54% of Boomers could not estimate their retirement number Q1144 9

11 A Majority of and Boomers Think Personal Finance Should be Taught by High School Personal Finance Should Be Taught by: Boomers Topics They Wish They Had Learned (More) About in School Boomers Grade schools (K-8) 29% 36% Wish to have learned (more) about ANY personal finance topic (NET) 93% 88% Basic investing 64% 68% High Schools (grades 9-12) 76% 78% How to save for retirement 58% 63% Household budgeting 51% 47% Colleges/Universities 50% 66% How loans work (e.g., college, mortgages, etc.) Insurance topics (life, health, auto policies) 55% 40% 52% 43% Parents 48% 55% Understanding what impacts one's credit score 55% 38% Should be self-taught, each person s own responsibility 21% 27% How to pay for college 50% 26% How to acquire credit 50% 24% None of the above 7% 12% Significant difference Q1162 / Q

12 11 Millennial Gender Differences

13 Millennial Women Report Making Less Household Income Than Millennial Men Median Annual Household Incomes for Millennial Men Millennial Women $82,800 $62,900 $42,300 $29,000 Non College Grad College Grad Q

14 Half of Millennial Women are Saving for Retirement, Compared to 61% of Millennial Men Have Started to Save Retirement Fund Have Not Started to Save Millennial Men Millennial Women Retirement Fund Millennial Men Millennial Women 61% 50% 39% 50% Q1132 / Q1133 / Q

15 Millennial Women Less Satisfied with Job Prospects, Career Growth and Financial Situation % Very/Somewhat Satisfied Millennial Men Millennial Women 78% 75% 65% 64% 68% 52% Employment prospects Career growth in your desired profession Overall financial situation Q

16 Millennial Women Less Confident in the Stock Market as Best Place to Invest for Retirement Despite the recent ups and downs of the stock market, it s still the best place to invest for retirement Millennial Men Millennial Women 83% 49% Q

17 Millennial/Boomer Women 16

18 Boomer Women Have Higher Incomes and are More Satisfied with Debt and Savings Levels Median Annual Incomes $44,500 Millennial women $66,300 Boomer women 58% of Millennial women are living paycheck to paycheck and are unable to save for the future, compared to 38% of Boomer women % Very/Somewhat Satisfied Millennial Women Boomer Women 68% 65% 47% 41% 57% 52% Debt levels Savings levels Overall financial situation Q1104 / Q1107 / Q

19 Boomer Women Feel Less Overwhelmed, More Confident in Stock Market Than Millennial Women Millennial Women Boomer Women 77% 55% 45% 51% 63% 67% 55% 23% Paying off my current debt is manageable and not much of a burden I feel overwhelmed with the Confident the stock market is a amount of debt I currently have togood place to invest for retirement pay off % Confident I am in control and, while it may not be easy, I can pretty much achieve the goals that I have set out to achieve Q1139 / Q1125 / Q