EBRI Issue Brief

Comparing the Financial Wellbeing of Baby Boom, Generation X, and Millennial Families: How Do the Generations Stack Up?

Dec 16, 2021 38  pages


Understanding the financial wellbeing of workers has never been more important. Millennials and Generation X are more likely to rely on their own savings when it comes to retirement security and face greater challenges when it comes to student loan debt than Baby Boomers. This, in turn, can lead to greater levels of financial stress in the workplace. More and more employers are beginning to recognize this and are accordingly offering financial wellbeing programs. And this ramp-up in benefits related to overall financial wellbeing may continue in light of a labor market that is evolving quickly.

This EBRI Issue Brief seeks to gauge the financial wellbeing of today’s work force with two sets of generational comparisons — Generation X vs. Baby Boomers, and Millennials vs. Generation X — by comparing key financial status indicators across generations at the same ages using the Survey of Consumer Finances. As a result, this unique methodology conveys the experience of tenured benefits industry professionals, whether in human resources or financial services, by contrasting the financial picture of today’s mid-career employees (Generation X) with yesterday’s mid-career employees (Baby Boomers) as well as today’s early-career employees (Millennials) with yesterday’s early-career employees (Generation X).

Key findings:

  • Overall, Generation X families were less likely to own a home or have any retirement plan than were Baby Boom families when their family heads were the same ages.
  • While Generation X families were more likely to have a defined contribution plan and have higher balances in the plan, they also had higher median debt — including student loan debt — and lower median net worth.
  • However, Generation X families in the highest income quartile did have a higher median net worth than their Baby Boom counterparts, and median net worth was higher for minority Generation X families than for comparable Baby Boom families.
  • For Millennial families, homeownership rates were lower than for Generation X at the same ages, while defined contribution (DC) plan ownership was more common.
  • However, Black Millennial families were less likely to own a DC plan than their Generation X counterparts. And while median DC plan balances were generally higher among Millennial families than Generation X families at the same ages, that was not the case for Black Millennial families.
  • The median net worth of Millennial families was lower than for Generation X families of the same ages, driven by the much lower net worth of those in the highest income quartile.
  • The one overriding financial indicator that was universally higher for the Millennial families compared with the Generation X families was the median debt levels, led by the substantially higher median student loan levels.
  • While all Millennial families saw larger shares of debt coming from student loan debt relative to Generation X families, Black and lower-income Millennials were particularly impacted by student loan debt.

The growing recognition of the competing demands that Generation X and Millennial families face with covering today’s expenses while also having to save for their future has caused employers to offer financial wellbeing programs to provide support to their employees from their financial stresses. These programs have matured to examine the full financial picture of the workers instead of a more limited focus on retirement plan accumulations. Consequently, how these generations continue to manage their finances and their working careers will be imperative for financial success in retirement. Will they up their savings? Will they work longer? Will they reduce their debt? All these will be difficult for many, but some actions are going to be necessary for these generations to be financially prepared for their final phase of life.