Bankrate.com recently shared the results of a survey they conducted and the results drew our attention.
When asked, “What annual income would you need to feel financially secure/comfortable?” Bankrate reports the following:
- Gen Xers (1965-1980) felt they would need $273,000 per year
- Baby Boomers (1946-1964) thought $240,000 would suffice
- Interestingly, Millennials (1981-1996) agreed upon $224,000 per year
- And the youngest cohort right now, Gen Z (1997-2013), felt $193,000 would keep them comfortable
The key here is the word ‘comfortable’. That’s a very subjective notion and one that will likely be different for every household. Regardless, it’s worth noting Gen Xers, those born after the Boomers and before Millennials, feel they need the most income to be comfortable and secure. Perhaps because they are the ‘sandwich generation’. Not only are they raising children and putting them through college, but they are also taking care of their elderly parents at the same time – a financial strain to say the least. It’s not surprising to see them projecting the highest number.
The survey also showed 35% of Baby Boomers feel they will “likely never be financially secure”. That compares to 30% of Gen Xers, 19% of Millennials, and only 13% of Gen Z. Why the discrepancy? Perhaps it is a shorter time horizon with less time to adjust course and make meaningful changes. But remember too, most Boomers grew up with parents who lived through the Great Depression which likely impacted how this generation views money and comfort i.e., the ‘I won’t ever have enough’ mentality.
No matter how you define it, it’s critical to have a plan in place for achieving whatever number defines comfort for you. And of course, that’s what we do!