Information extracted from the Financial Wellness 2019 Year in Review

A quick glance back at 2019 uncovered a few interesting trends in financial wellness. Debt problems persist across the generations. Nearly one in two Millennials has student loan debt, and one in three struggle to keep up with payments. Forty-one percent of Gen X workers say they are uncomfortable with their debt, and 35 percent of Baby Boomers cite getting out of debt as a top priority. For Baby Boomers, debt could be a hindrance to retirement, as only 42 percent report being on track.


Millennials continue to have the highest percentage of unmanageable financial stress among the three generations studied. Thirty-two percent are struggling to manage their cash flow, and less than half (46 percent) have an emergency fund to cover unplanned expenses or loss of income. Of the 45 percent that are uncomfortable with the amount of debt they have, 76 percent report feeling overwhelmed by it. Forty-two percent of Millennials carry a balance on their credit card, and 48 percent have student loan debt. Of those with student loans, 33 percent are struggling to keep up with their payments. As the percentage of Millennials in the workforce increases, employers should consider including debt management assistance as part of a holistic financial wellness benefit.

Generation X

The so called “sandwich” generation, these employees often find themselves having to deal with competing financial priorities. The majority are married (66 percent), have minor children (56 percent), and own a home (75 percent). Studies show that Generation X carries the most mortgage9 and non-mortgage debt10 of any generation, which may explain why four in ten (41 percent) feel uncomfortable with their debt, among whom 67 percent are overwhelmed by it. Three in ten (30 percent) still make payments on student loans, and almost four in ten (38 percent) are struggling to make the payments. Among employees of this generation that are parents, 28 percent are actively saving for both college and retirement, but less than one in five (19 percent) are on track to meet both goals. This generation would respond well to group education focused on mid-career financial planning.

Baby Boomers

Nine in ten (90 percent) Baby Boomers cite retirement planning as a top priority, with protecting wealth (38 percent) a distant second and getting out of debt (35 percent) a distant third. Despite being the most prepared of the three generations studied, Baby Boomers are sadly under prepared for retirement. Only 42 percent are on track for retirement, and another four in ten (40 percent) have failed to run a retirement projection. Squarely in the pre-retirement phase of life, the biggest challenge faced by this generation is time. Baby Boomers only have a few more years to accumulate enough assets to supplement their income over an average 20-to-30-year life expectancy.

To make things worse, there has been a rise in household debt among older Americans. According to the Employee Benefit Research Institute (EBRI), the average total debt for households ages 50 to 64 rose from $80,000 in 1992 to $120,000 in 2016. They found that households with debt worked longer, and parents who provided financial support to children and grandchildren increased their likelihood of having debt.11 The good news is that interest rates are relatively low, making debt more affordable, however interest rates could go up in the future, and that could force Baby Boomers to work longer, or risk running out of retirement assets sooner.

Lastly, with the onset of the coronavirus global pandemic in the first quarter of 2020, many Baby Boomers are having to rethink their investment strategy. Although six in ten (60 percent) that completed a financial wellness assessment in 2019 are confident their investments are allocated appropriately, less than half (49 percent) are comfortable with the investment basics and how to apply them. With such a high level of market uncertainty, it is likely that retirement preparedness numbers will get worse before they get better. For a generation that may already be struggling to save for retirement, the havoc COVID-19 is having on the global economy could be the proverbial straw that breaks the camel’s back. Employers can help pre-retirees cope with the financial stress brought on by recent market activity by offering one-on-one sessions with a financial coach as part of an ongoing financial wellness benefit.

Published on September 11, 2020