TIAA reported recently on a survey conducted by KRS Research, which turned up a curious statistic.
The poll found that 27% of adult children are worried about their parents’ ability to fund a secure retirement. These respondents are twice as likely to be worried about their own retirement planning than children who are unconcerned about their parents’ wellbeing. It seems that anxiety breeds anxiety.
Fifty-seven percent of respondents said directly that their parents’ financial planning practices influenced their own decisions, particularly in matters of avoiding debt and limiting discretionary spending.
A TIAA spokesman commented that “People who are concerned about their parents’ financial well-being in retirement may be sacrificing their quality of life today out of concern for their own financial future.”
The TIAA-sponsored survey revealed that younger respondents are far more sanguine about their parents’ financial situation than generations living closer to the reality of retirement. Among the so-called millennials, 52% said their parents are well-positioned in financial terms. Thirty-five percent of Generation X respondents were similarly optimistic. Finally, among the Baby Boomers, who are staring retirement in the face, only 26% thought their parents were financially secure.
Similar patterns were seen when discussing the retirement plans of parents. Young people seem instinctively to worry less – or perhaps are insufficiently experienced to accurately judge the situation.
This overconfidence may bode ill for the future. The TIAA spokesman said, “The confidence that millennials have about their parents’ finances may actually create a false sense of security, especially when individuals mistakenly believe they will receive an inheritance…”
For more information, please read:
How Parents’ Financial Planning Influences Adult Children | ThinkAdvisor