Rethinking Retirement: A Generational View

Oct 3, 2024 | Articles

Rethinking Retirement: A Generational ViewRetirement expectations vary across generations, shaped by unique experiences and economic conditions:

  • Baby Boomers (1946–1964): View retirement as a reward after hard work, often seeking financial security and leisure, with some benefiting from company pensions.
  • Generation X (1965–1980): Pragmatic and self-reliant, they grew up with fewer pensions and more defined contribution plans, prioritizing financial independence and stability.
  • Millennials (1981–1996): Focus on work-life balance and personal fulfillment, with flexible ideas about retirement, often seeking new passions or business ventures instead of a fixed endpoint.
  • Generation Z (1997–2012): Despite financial challenges like student loans, 70% are saving for retirement, often starting earlier than older generations.

Key Retirement Challenges Across Generations

  • Economic Conditions: Baby Boomers benefitted from a strong job market and stable income, while younger generations deal with student debt and higher living costs.
  • Retirement Plans: Boomers benefited from traditional pensions, but younger workers must invest in 401(k) plans, shifting financial responsibility to the individual.
  • Job Market Stability: Gig economy jobs make retirement savings harder.
  • Social Security Concerns: Younger generations doubt its future, pushing them to save more aggressively.

Post-Pandemic Shifts

The COVID-19 pandemic has altered retirement planning. Many now seek phased retirements, balancing part-time work with personal passions. A study by Fidelity revealed that two-thirds of respondents have changed their retirement goals post-pandemic, focusing more on flexibility and fulfillment.

 

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