Editor ’ s Note
May 2023 • www . fa-mag . com
The Coming Generational Showdown
I
T IS SOMETIMES NOTED THAT BABY BOOMERS AND THEIR MILLENnial offspring live lives far more deeply intertwined than previous generations . Boomer parents have been highly engaged in their children ’ s early development from school to athletics and extracurricular activities . Many watch the same reality shows as their children and vacation with them , and the generations advise each other on career moves and other major decisions .
Stereotypes are frequently overdone , but millennials were in no rush to get their own cars and get out of the house like the Beach Boys generation was . The economic circumstances no doubt played a role in the decision of some to move back into their parents ’ house after the Great Recession .
But the cost of raising children has exploded over the last 50 years , thanks largely to the unsustainable tuition increases at the nation ’ s colleges . Having priced themselves out of reach for many Americans , it ’ s little wonder that hundreds of colleges are now closing their doors .
If only it stopped there . A recent Bankrate report found that 70 % of parents say they have sacrificed their savings to support children over 18 and 50 % are dipping into emergency funds or delaying paying down debt .
Perhaps boomers and Gen Xers can be blamed for pampering their children but it ’ s getting too late in the game to point fingers . The Social Security trust fund is scheduled to run out of money in 2033 or thereabouts . Medicare will be exhausted even sooner .
It ’ s no longer a problem for the distant future . Saving or reforming both programs is likely to be the dominant issue in the 2028 presidential election if not before .
By any measure , the current generation is very different from preceding ones and , in many ways , their frugality and financial conservatism will suit them well .
KNOWLEDGE FOR THE SOPHISTICATED ADVISOR
Chelsea Ransom-Cooper is a managing partner and the financial planning director at Zenith Wealth Partners .
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If anyone wants to find signs of encouragement in this whole mess , Financial Advisor ’ s cover story on Young Advisors To Watch ( on page 40 ) might be a good place to start . By any measure , the current generation is very different from preceding ones and , in many ways , their frugality and financial conservatism will serve them well .
It also seems their diminished expectations may be an advantage . I once asked a Danish economist why his compatriots always came out at the top of lists that rank nations by levels of happiness . His response was that they have more realistic expectations than Americans .
Millennials and members of Gen Z also would appear to have their priorities in order when it comes to money . They want it to work for them and service other goals , not be an end in itself .
There is hope yet .
Evan Simonoff
Email me at esimonoff @ fa-mag . com with your opinion .
8 | FINANCIAL ADVISOR MAGAZINE | MAY 2023 WWW . FA-MAG . COM