Two new surveys highlight the differing financial situations of older and younger adults.

The EY Financial Wellness Assessment, part of Ernst & Young LLP’s Employee Financial Wellness services, surveyed more than 3,000 respondents ranging in age from 18 to over 65 between February and April of this year. Most of the respondents were employees of large corporations and nonprofit organizations in a wide variety of industries.

When asked to think about assets, debts, savings and how satisfied respondents were with their personal financial situation overall, 44 percent said they were satisfied, while 28 percent said they were dissatisfied. More than half (51 percent) of those aged 50 to 64 said they were satisfied with their financial situation, the most satisfied of all the age ranges.

Nearly 73 percent said their debt was manageable, with 10 percent saying they had no debt at all. Even 64 percent of those just beginning their careers or just out of college (18 to 25 year olds) said their current debt was manageable.

When asked how many times over the past 12 months they had paid a bill past its due date, 20 percent said they had submitted late payments once or twice. However, in a spike from the average, 31 percent of 36 to 49 year olds admitted they had paid a bill late one to four times over the past year.
Of the employees who consistently use credit cards, 62 percent said they pay the balance in full each month. Approximately a quarter (27 percent) said they pay more than the minimum due. The remaining 6 percent of working credit card users only pay the minimum.

Fifty-six percent (up from 44 percent during the last assessment period from November 2015 to January 2016) believed they could maintain their minimum standard of living in the event of a 6-month absence from the workforce due to medical issues. Eighty seven percent were confident they would be able to come up with $2,000 if an unexpected need arose within the next month and of those who are 65+ almost 100% stated they could. 

When asked about the last time they tried to determine how much they would need for retirement, 39 percent of the EY survey respondents reported estimating their needs within the last 12 months, but 37 percent said they had never tried. Nearly 40 percent of 18 to 25 year olds have begun to think about retirement planning.

A separate report by Financial Finesse, a company that provides financial advice for employee wellness programs, also reported on how different generations managing their financial wellness.  Based on an analysis of over 35,000 financial wellness assessments completed in 2014 and 2015, improving financial wellness of younger employees from a 4.0 to a 5.0 (on Financial Finesse's 10-point scale) translates into a 12 percent improvement in projected retirement savings. An improvement from 4.0 to 6.0 equates to a 27 percent improvement in projected retirement savings.

Debt is a growing concern for many employees, however, according to Financial Finesse’s survey. Employees are at risk of becoming significantly overleveraged, and this could be a problem for older employees who face the possibility of carrying consumer debt into retirement, the company noted.

Baby Boomers had the biggest decrease in the percentage that have a plan to pay off their debt (64 percent to 58 percent) and the biggest increase in those that are experiencing late fees (11 percent to 15 percent), when comparing the financial wellness assessments from 2014 and 2015.

In addition, 55 percent of the Generation X respondents indicated “getting out of debt” as a top-three priority, and 53 percent cited “lack of emergency savings” as a top-three vulnerability. Forty-three percent of Millennials indicated they have serious debt, making it a top-three vulnerability.

Across all generations, employees are increasingly assessing their own financial situations to determine where they stand in terms of achieving their short- and long-term financial goals, Financial Finesse found, while a higher percentage of employees across all generations are running a retirement calculator, checking credit scores, and projecting college expenses.

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