Retirement Planning: Speaking the Generations’ Languages
An at least tacit understanding of the importance of saving for retirement may be a common language of the current workforce, but the three generations that compose the bulk of it — Baby Boomers, Generation X and Millennials — each speak their own dialect. In “Generational Differences: Ready or Not — Retirement?” the National Association of Government Defined Contribution Administrators, Inc (NAGDCA) helps translate each group’s needs
regarding better preparing to finance their golden years.
This information is key importance to employers, plan administrators and sponsors, and advisors in motivating these populations to save and in increasing enrollment in plans that will help them to do so.
The importance of understanding each generation’s needs is in sharp relief given the recent report that the Millennials — those born between 1981 and 1997, ages 18-34 — are now the largest age group in the United States. Employers, plan administrators and sponsors, and advisors may find it wise to adjust their approaches accordingly, since this is the youngest group in the workforce, and, therefore, the one in which the most long-term progress can be made in establishing and supporting good retirement saving habits.
An additional statistic NAGDCA cites that heightens the importance of buttressing retirement saving is that by 2030 — a mere 15 years from now — nearly 20% of the U.S. population will be age 62 or older. Boomers — those born between 1946 and 1964, ages 51-69 — may not be the biggest age group, but they still are a very sizable one, and those abundant ranks will be the ones heading for the retirement door. And that means a different dialect of retirement-speak is called for to help these masses prepare for a professional exit that is more imminent than that of the other groups.
The nuances of the language or retirement preparation to which each group is most attuned reflect their stage of life. For instance, the characterization of their retirement focus:Baby Boomers:
Do I have enough?Generation X:
Am I saving enough?Millennials:
Feels like a luxury to save, many not focused at all.
There also are stark differences regarding how to best deliver education about retirement; most notable is that in-person communication and interaction is less important as age decreases:Baby Boomers:
online through email, search engines, news and blogs, but supplement with face-to-face conversationGeneration X:
online and digitally, as well as through YouTube, Facebook, email and networkingMillennials:
online and digitally, as well as through YouTube, Facebook and email
Additional highlights of factors unique to each group are available here