Generation Beta — those born between 2025 and 2039 — are predicted to live longer, see unparalleled
In a new survey from Prudential, more than 2,000 adults of different ages offered predictions on how family structure, career paths, technology and
When it comes to retirement, almost half of today's parents and future parents don't expect their child to ever stop working, and 75% predict the retirement age to be bumped nearly a decade, to 75 years old, Prudential found. While today's retirees should plan to save $1.2 to $1.4 million, according to various sources, it's expected Generation Beta retirees will need $1.88 million in order to leave the workforce comfortably.
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This generation will need more money to sustain longer life spans, as Prudential's survey found that advancements in technology are expected to have a profound impact on healthcare and well-being, with 59% of people saying AI and robots will be able to predict and prevent health issues and over half saying Gen Beta will cure cancer.
"By the time Gen Beta turn 70 years old — in the year 2095 — the world will look very different, including people living longer in retirement than they do today," says Dylan Tyson, president of retirement strategies at Prudential. "It will take even more flexible, customized financial planning to help younger generations protect their life's work."
What parents say about saving
The number one regret of current and future Beta parents surveyed was not saving more for their own retirement. Perhaps this is why 80% said they would advise saving for a child's retirement from the time they're born.
While this newest generation has decades before they will even enter the workforce, their parents can help them get a head start — and survey their own aspirations in the process, says Tyson.
"My advice to the parents of Beta babies is this: Take a moment now, or soon, to think of the hopes and dreams you have for your baby, and then start a habit of saving to fund those hopes and dreams to the extent you are able and invest wisely as part of a sound financial plan," he says. "By taking these small actions today, you will give the members of our newest generation a head start by helping them to not only live longer lives, but better lives."
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Today, many employees have a hard enough time saving for their own retirements, let alone the retirements of their children. Working with a financial adviser can help them hone these savings strategies and make short, long and very distant financial plans, Tyson says.
"We've begun to turn a corner in the way people view retirement and the shared opportunity that exists across future generations to achieve retirement security," he says. "From the study, we see that the parents of Generation Beta are worrying about not just their own retirement, but their children's full financial journey. Making an individualized plan for the full family with the help of a financial planner will be a key component."
To give parents a head start, Prudential offered a "Beta Baby Bonus" of $150 to those whose children were born on the first of this year. Parents can apply by opening an account with the company and filling out the corresponding application. If invested toward retirement, this amount has the potential to grow into $100,000 by the time their child turns 70.
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By becoming better educated themselves, Beta parents have the potential to pass along great savings habits to their children. As they transition to adulthood, it will be this, along with innovative methods of saving and investing that will allow Gen Beta to create a sustainable financial future for themselves.
"To protect their life's work and achieve financial security, Generation Beta will need to save early and plan strategies to both grow assets and turn their nest eggs into reliable streams of retirement income to care for their needs, wants and wishes," Tyson says. "Having guaranteed income strategies included as automatic defaults in workplace defined contribution plans like 401(k)s, as well as customizable protected income strategies for individual retirement (IRAs) and managed accounts, will be key pieces to the puzzle."
