The baby boomers have been called the "Me Generation" because of their supposedly self-centered attitudes but a new study finds nothing selfish about boomer behavior as they near retirement age.
Quite the opposite, in fact. Amerirprise Financial says boomers are sacrificing their retirement security to support their adult children and, in many cases, their aged parents.
More than half (55%) of baby boomers admit they’ve allowed their adult children to move home and live rent-free – but the support most provide their kids and aging parents extends well beyond room and board, according to the study, Money Across Generations II.
In fact, boomers continue to prioritize their families’ needs over their own, despite increased uncertainty about their own financial security, the study found.
“Boomers are feeling the pressure financially and emotionally,” says Suzanna de Baca, vice president of wealth strategies at Ameriprise Financial. “In many cases they’re sandwiched between children who are unemployed or struggling to pay down their student loan debt and aging parents who are facing complex health and financial issues. At the same time, they’re trying to prepare for their own retirement. The demands on their time and money can feel endless.”
One in four
In 2007, when the original Money Across Generations study was conducted, 44% of boomers claimed they were trying to grow their savings. Now only one in four (24%) say they’re putting away money for the future and just as many (24%) report simply trying to maintain what they have.
While boomers’ attitudes have changed, the level of support they’re providing family members has not. More than half (58%) report assisting their aging parents in some way, including helping them purchase groceries (22%) or pay medical (15%) and utility bills (14%).
When it comes to their children, boomers are even more generous. Most boomers surveyed (93%) say they have provided some kind of support to their adult children. A majority have helped them pay for college tuition or loans (71%) or helped them buy a car (53%). Many are also helping their kids pay for car and health insurance, as well as cover basic expenses like rent, utility and car payments.
Despite uncertainty around meeting their own financial goals, a majority of boomers (86%) say that if they had to do it again, they would still support their adult children financially. Meanwhile, 20% express guilt about not being able to provide financial assistance to their adult children who currently need it.
Pretty admirable, you say? Not necessarily. In fact, some boomer offspring blame their parents for not doing a better job of teaching them about thrift.
More than half say that while growing up, their parents rarely or never talked to them about how they budgeted the family’s money (56%) or the importance of saving for retirement (52%). And while a majority say that their parents’ approach to spending and saving was fairly balanced, 30% feel their boomer parents’ attitude toward money was “live for today.” Only one-in-ten (11%) feel their parents conveyed an attitude that encouraged preparing for the unexpected.