A MetLife Survey: Hispanic Multi-Generational Views of Family Financial Obligations

A MetLife Survey: Hispanic Multi-Generational Views of Family Financial Obligations

Would provide financial support to your own parents or in-laws in their later years if they have financial difficulty 65% VS. 46% A MetLife Survey: Hispanic Multi-Generational Views of Family Financial Obligations Would have a parent live with you if she/ he is not healthy enough to live without some caregiving 77% VS. 58% Would have a parent live with you if she/ he is having financial difficulty 74% VS. 50% OVERVIEW The Hispanic population is flourishing in the United States. The American Dream of unlimited possibilities, freedom and opportunities remains a beacon of prosperity for this growing segment of the population. With more than 50 million residing in the U.S. today and census data projecting that they will comprise one-third of the population by 2050, will significantly influence future American values and core beliefs. The findings of MetLife s Hispanic Multi- Generational Survey reflect the responsibility feel for their loved ones. A sense of pride in helping family members, both younger and older, encompasses everything from financial support and inheritances to gift giving and life insurance. Hispanic children, spouses and grandparents show a strong degree of interconnectedness and commitment to taking care of family. For instance, the study revealed that 80 percent of call their parents once a week to see how they are doing, as opposed to only 62 percent of the general population who do the same. The study uncovered generational divides (X, Y and Baby Boomers 1 ) and differences between U.S.-born and those born outside of the U.S. For example, born outside the U.S. feel confident, more secure and more likely to support family than born in the U.S. At times, financial attitudes of who grow up in the U.S. more closely resemble those of non-. MetLife s multi-generational research underscored how important family is to each age group within the Hispanic population. And regardless of country of birth, willingly accept the financial and personal responsibilities associated with family. Several factors differentiate them from the general U.S. population demonstrating that for, success means family. Hispanic children, spouses and grandparents show a strong degree of interconnectedness and commitment to taking care of family. 1 Generation X is defi ned by participants born from 1965 to 1976, Generation Y is defi ned by participants born from 1977 to 1990 and Baby Boomers are defi ned by participants born from 1946 to 1964.

va ues SUPPORT ACROSS GENERATIONS Despite reporting a high degree of financial independence across generations, show a great range of financial support being extended across generations. are much more likely than the general population to feel responsible for the financial well-being of their family, including their parents. At twice the rate of the general population, 57 percent of all surveyed reported providing financial assistance to parents. At 71 percent, foreign-born are even more likely to provide financial assistance to a parent. Since they are more likely to have family abroad, foreign-born are also more likely to provide assistance by sending money to family members outside of the U.S. than their native-born counterparts. Holding true to traditional family values, are more likely than the general population to support their parents in times of need. Sixtyfive percent would provide financial support to their parents or in-laws in case of financial difficulty, 74 percent would have a parent live with them in case of financial difficulty and 77 percent would have a parent live with them if they were not healthy enough to live without caregiving. Holding true to traditional family values, are more likely than the general population to support their parents in times of need. For, ensuring the well-being of a spouse or partner in the event of an untimely death is also of great importance. The resources to protect loved ones are critical in making sure the family support structure stays intact. Seventy-one percent of feel confident that their spouse/partner would be financially secure if they were to pass away relatively soon. Respondents were also emphatic about their significant other having long-term financial security, defined as more than 10 years, in place should they die prematurely. Naturally, Baby Boomers feel a greater degree of responsibility than younger generations since a spouse/partner s ability to work becomes more limited with age. 1

A MetLife Survey: Hispanic Multi-Generational Views of Family Financial Obligations There is also clear evidence that believe in the importance of education to help future generations succeed. Financial support for educational needs is the most common form of assistance given and received in Hispanic families. Seventy-two percent of believe they should provide financial support for higher education to their children and grandchildren, far surpassing the 48 percent of the general public who share the sentiment. Among the age groups, Generations X (24%) and Y (38%) expressed the greatest desire to help fund their grandchildren s education. Overall, 84 percent feel a responsibility to provide for their children until they have completed college. Because of their age, Baby Boomers are most likely to provide financial support to children and grandchildren. Regardless of country of origin and across all generations, the idea of lending a hand to loved ones is deeply ingrained in the Hispanic community. It is a reciprocal relationship that allows to rely on family for support in times of need. The MetLife Hispanic Multi-Generational Survey examined the types of support received and what types of support are given to family members. Interestingly, foreign-born were much more likely to provide support to children on all levels compared to U.S.- born. Among the report s other key findings: Eighty-two percent of foreign-born contributed to their children s education and/or training after high school as compared to 61% of U.S.-born Seventy-one percent of foreign-born have given financial help to one or both parents compared to 46% of U.S.- born Sixty-eight percent of foreign-born provided financial support for things other than education or a home down payment as compared to 53% of U.S.-born Eighty-eight percent of foreign-born have provided assistance by sending money to family members outside of the U.S. as compared to 67% of U.S.-born Would provide financial support for your children s higher education 72% VS. 48% Would leave an inheritance for your children 52% VS. 28% Would help your children financially if they experience a financial setback through no fault of their own 60% VS. 44% Overall, had higher response Would provide non-financial support to rates regarding financial support received your adult children, such as help with from family. In almost all cases, babysitting or help around the house were more likely to receive support than the general population, particularly when it 58% VS. 44% comes to education and home mortgages. For example, more than half of, compared to 40 percent of the general population, received help for education Would allow an adult child to live with you beyond high school. Hispanic Generation if she/he is having financial difficulty (due Y (61%) received the most support and to job loss, divorce, etc.) once again trumped the general population (46%). Interestingly, the one area where the 62% VS. 45% general population (31%) was more likely to receive financial assistance was through inheritance from a parent who passed away, versus at only 19 percent. commim 2

Your parent(s) have contributed toward the costs of education or training for you after high school 51% VS. 40% In your adult years, your parents or grandparents have helped you out financially for things other than education or a down payment 51% VS. 46% Your adult children have given you financial support 22% VS. 9% You have received an inheritance from a parent who died 19% VS. 31% tment Financial support for educational needs is the most common form of assistance given and received in Hispanic families. 3

A MetLife Survey: Hispanic Multi-Generational Views of Family Financial Obligations PREPARING FOR THE UNEXPECTED Life insurance ownership among (70%) is trending upwards, nearly matching ownership levels among the general population (73%). Family safety nets are of critical importance to every population segment as they provide security in times of need and allow families to maintain their standard of living despite unfortunate circumstances. According to the findings, understand the importance of having a safety net and the role life insurance can play in building one. Current Hispanic life insurance ownership rates are nearly double those of previous generations. Respondents reported that only 36 percent of their parents owned life insurance at the same stage in life. Of the 70 percent who own life insurance, 55 percent pay for their own, and 40 percent have employer-sponsored. The average value of life insurance owned by is $268,000, with generation X owning the most amount at an average of $343,000. CONCLUSION For, protecting one s family Among, Generation X is most is important, especially in the event of likely to have or want life insurance in order their passing. Even those who don t own to save/transfer money in a tax-advantaged life insurance recognize they need it, half way and to pay for their children s education, reported they would like life insurance. should they die prematurely. Baby Boomers However, perceived cost and personal are the most likely to have or want life financial limitations are the most common insurance to pay off the mortgage on a reasons for being uninsured. Other reasons house in the event of their death. Also, the include, 51 percent of who likelihood of having or wanting life reported they don t want to think about insurance in order to pay off non-mortgage death and 37 percent who feel that other debt increases with each younger generation. people will take care of their loved ones in Interestingly, Generations X and Y are the the event of an unfortunate circumstance. most likely to buy life insurance in order to Generation X supports this sentiment at a give their heirs a financial boost and/or let rate of 24 percent. their heirs know how important they were to them. These trends demonstrate the shift Compared to the general population, that is occurring in financial priorities and are more likely (47%) to consider behaviors among : Baby Boomers purchasing life insurance for a child but show more concern about their home; few (11%) have already done so. More than education and savings are a higher priority three-quarters of are open to family receiving life insurance as a gift from their parents, and feel it would give them a greater sense of financial security. for Generation X; and Generation Y is more concerned about other debt, such as credit cards and car loans. Family is central within the Hispanic culture. The MetLife Hispanic Multi-Generational Survey uncovered that throughout generations and regardless of where they were born, overwhelmingly have a strong familial bond as it relates to financial responsibility. As providers and beneficiaries, the family unit remains strong. For, financial responsibility is not just about the present, but also the future. While there are barriers, whether due to perception or reality, there is a trend that suggests are becoming and want to become more prepared in case of unforeseen circumstances. Changes in financial priorities and behaviors can be a sign of the times or simply evolution, but for, leaving a legacy, protecting and providing for loved ones remains at the heart of any change. MetLife, Inc. is a leading global provider of insurance, annuities and employee benefit programs. With 90 million customers in over 60 countries, MetLife has helped individuals and families from diverse communities achieve financial security for more than 140 years. To learn more, visit metlife.com. 4

All findings were derived from the Multi-Generational Views on Family Financial Obligations Study 2012. Pursuant to IRS Circular 230, MetLife is providing you with the following notification: The information contained in this document is not intended to (and cannot) be used by anyone to avoid IRS penalties. This document supports the promotion and marketing of insurance products. You should seek advice based on your particular circumstances from an independent tax advisor. MetLife, its agents and representatives may not give legal or tax advice. Any discussion of taxes herein or related to this document is for general information purposes only and does not purport to be complete or cover every situation. Tax law is subject to interpretation and change. Tax results and the appropriateness of any product for any specific taxpayer may vary depending on the facts and circumstances. You should consult with and rely on your own independent legal and tax advisors regarding your particular set of facts and circumstances. January 2013. Metropolitan Life Insurance Company First MetLife Investors Insurance Company 200 Park Avenue New York, NY 10166 metlife.com MetLife Investors Distribution Company MetLife Investors USA Insurance Company 5 Park Plaza, Suite 1900, Irvine, CA 92614 1209-3473 CLDM22929 L0113298809[exp0115] 2012 METLIFE, INC.