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Baby Boomers and Finance - US - November 2015

Published By :

Mintel

Published Date : Nov 2015

Category :

Banking

No. of Pages : N/A

Financial services institutions may be focusing a lot of attention on Millennials, but Boomers are still a very influential group. According to the US Bureau of Labor Statistics

Table of Content

Overview

What you need to know
Definition

Executive Summary

The issues
Many haven’t saved enough and they know it
Figure 1: Concerns about retirement life, by amount of retirement savings, August 2015
Boomers are not loyal to their financial institution
Figure 2: Purchased multiple products from primary financial institution, by generation, January 2015
The opportunities
Boomers can help advisers grow their business
Figure 3: Use of financial advisers, by amount of retirement savings, August 2015
Boomers trust credit unions more than banks
Figure 4: Boomers’ level of trust in financial services institutions, January 2015
Most Boomers don’t have enough life insurance
Figure 5: Life insurance needs, by age, August 2015
What it means

The Market – What You Need to Know

Boomers are still relevant
Boomers are not very diverse
Low interest rates have hurt
Longer life expectancies

Market Size

Boomers are still one-quarter of US population
Figure 6: US population, by generation, 2010-20

Market Breakdown

The racial diversity of Boomers
Figure 7: Distribution of generations by race and Hispanic origin, 2015
More female Boomers than male
Figure 8: US population, generations by gender, 2015

Market Factors

Impact of low interest rate environment
Boomers’ investments in equities
Life expectancies are increasing
Figure 9: Life expectancy in US, 1980-2012

Key Players – What You Need to Know

Aging in place – A new trend
Boomers are starting businesses
Single Baby Boomers are struggling
Workplace flexibility helps Boomers continue to work

What’s In?

Boomers want to age in place
Figure 10: Plans to move in retirement, by generation, August 2015
Boomers are well-positioned to start businesses

What’s Struggling?

The effect of Social Security payments on Boomers
Figure 11: Finances in retirement, by gender and age and Hispanic origin, August 2015
More single Baby Boomers
Figure 12: Retirement savings, by marital status, August 2015
Many Boomers are not taking steps to improve their retirement prospects
Figure 13: Attitudes toward retirement, by generation, August 2015
Lack of planning leads to miscalculations
Figure 14: Baby boomers’ steps taken toward retirement planning, January 2015

What’s Next?

Flexible work schedules are helping Boomers continue working
Figure 15: Desire to work after retirement, by age, gender and household income, August 2015
Growth of the sharing economy
Boomers are selling – And starting – Small businesses
Boomers’ effect on the housing market
Figure 16: Importance of owning a home, by generation, May 2015

The Consumer – What You Need to Know

Most Boomers have never retired
Most haven’t waited for full Social Security benefits
Money and health – Two main concerns
Most do have retirement savings
Advisers can help Boomers realize plans
Boomers aren’t comfortable with their saving, but are not getting help

Retirement Status

Most Boomers have never retired
Figure 17: Retirement status, by gender, August 2015
The role of age and income in decision to retire
Figure 18: Retirement status, by age and household income, August 2015
The impact of education on retirement
Figure 19: Retirement status, by level of education, August 2015
Health considerations are a major reason for young Boomer retirement
Figure 20: Reasons for retiring, by gender and age, August 2015

At What Age Do Boomers Retire?

Maximum Social Security benefits not a driving retirement force
Figure 21: Age at retirement, by gender and age, August 2015
Most won’t retire until after age 65
Figure 22: AARP online retirement planning ad, 2015
Impact of marital status
Figure 23: Age plan to retire, by marital status, August 2015
The role of income in determining retirement age
Figure 24: Age plan to retire, by household income, August 2015

Concerns about Retirement Life

Most are worried about money
Figure 25: Concerns about retirement life, by age, August 2015
Priorities change with savings
Figure 26: Concerns about retirement, by retirement savings, August 2015

Type of Retirement Account(s) Owned

Most Boomers have a retirement account
Figure 27: Type of retirement account(s) owned, by generation, August 2015
Women are less likely to have corporate-sponsored plans
Figure 28: Type of retirement account, by gender, August 2015
Minority Boomers have fewer retirement accounts
Figure 29: Type of retirement account, by race, Hispanic origin, August 2015

Amount of Retirement Savings

Many late Boomers may be in trouble
Figure 30: Amount in retirement savings, by generation, August 2015
Women Boomers lag men
Figure 31: Amount in retirement savings, by gender and age, and generation, August 2015
Single Boomers are in trouble
Figure 32: Amount in retirement savings, by marital status, August 2015
Figure 33: Wells Fargo Retirement Resources email, 2015

Plans for Retirement

Most looking forward to traveling
Figure 34: Plans for retirement, by generation, August 2015
Family is important to Hispanics
Figure 35: Plans for retirement, by Hispanic origin, August 2015
Many want to stay active
Figure 36: Plans for retirement, by generation, household income, August 2015

Managing Money

Most don’t know enough
Figure 37: Money management activities, by gender and age, August 2015
Whites and married couples are in better shape
Figure 38: Money management activities, by race and marital status, August 2015
Advisers not used by many
Figure 39: Money management activities, by amount of retirement savings, August 2015
Figure 40: AARP direct mail and online ads, 2015
Source of retirement income
Figure 41: Source of retirement income, by gender, generation, August 2015

Factors Affecting Retirement Income

What Boomers are counting on for income
Figure 42: Factors affecting retirement income, by gender, generations, August 2015
Race and income have an effect
Figure 43: Factors affecting retirement income, Hispanic origin, household income, August 2015

Attitudes toward Retirement

Lack of excitement about retirement due to lack of comfort about money
Figure 44: Attitudes toward retirement, by gender, generation, August 2015
Life in retirement
Figure 45: Retirement assumptions, by gender, generations, August 2015
Race and income affect retirement life
Figure 46: Retirement assumptions, by race, household income, August 2015
Retirement readiness
Figure 47: Retirement readiness, by gender, generation, August 2015

Appendix – Data Sources and Abbreviations

Data sources
Consumer survey data
Direct marketing creative
Abbreviations and terms
Abbreviations
Terms

List of Table

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