Boomers offer friendship and financial
support but one in four Millennials still dips into retirement
accounts
UBS Wealth Management Americas (WMA) today released its
quarterly UBS Investor Watch report, "The ties that bind," focused
on how wealthy Baby Boomers and their Millennial children are
redefining the traditional parent/child relationship. The findings
reveal the stark contrast between Millennials' view of their
parents as peers and friends, and Boomers' more authoritative view
of their parents. The strong ties between Millennials and Boomers
last far into adulthood and often include financial support —
nearly three quarters (74%) of Millennials receive some form of
financial assistance from their parents.
"Boomers and Millennials are as much friends as they are parents
and children," said Paula Polito, Client Strategy Officer of UBS
Wealth Management Americas. "Their unique relationship deepens
their bond, and they maintain both close emotional and financial
ties."
Redefining family
The majority of Millennials view their parents as peers, mentors
and friends, whereas more Boomers saw their parents as authorities.
Nearly three quarters (73%) of Millennials say they connected with
their parents more than once a week during college, compared to 34%
of Boomers.
In terms of planning their own families, Millennials are putting
off marriage and children later than Boomers did, opting for
adventure and life experience: 28% say they have traveled the world
for six months or more, compared to 12% of Baby Boomers.
Boomers happily give Millennials financial support
Baby Boomer parents are overwhelmingly positive about their
ability to help their children financially. A majority (80%) said
they feel good about providing financial support, while only 10%
say they withhold it to teach adult children financial
responsibility. However, 52% of Millennials feel shame, frustration
or guilt about accepting assistance from their parents.
The financial support Millennials receive from their parents
takes many forms. Most is for necessities: health insurance (29%),
home buying/renting (28%), auto insurance (26%) and utilities
(23%), though Millennials receive funding for vacations (19%) and
spending money (21%) as well.
Millennials are almost twice as likely to move home after
college as their parents were. The primary motivation for doing so
is to save money; however, 24% of Millennials prefer to live with
their parents, while 22% say their parents wanted them to stay.
Fiscally conservative Millennials are focused on the
“now”
Investor Watch found that when it comes to finances, a majority
of Millennials (73%) tend to focus on short-term needs and goals,
such as homes and travel, believing retirement is too far away to
worry about. Over half of Millennials with retirement accounts have
or would consider dipping into them to make a large purchase, with
25% having already withdrawn funds.
Millennials have a completely different view of the markets than
Boomers and are highly risk averse. On average, Millennials hold
twice as much cash as Boomers (47% of assets vs. 20% for Boomers).
However, they do not appear to feel safer or more content with
their finances: only 29% are happy with their portfolios, compared
to 78% of Baby Boomers.
"The ties that bind Boomers and Millennials
are deep and long lasting," said Sameer Aurora, Head of Client
Strategy for UBS Wealth Management Americas. "The relationship has
major financial implications for both generations, but few
Millennials are adopting their parents' investment behaviors."
We invite you to read the full report here:
www.ubs.com/investorwatch
About UBS Investor Watch
UBS Wealth Management Americas surveys U.S. investors on a
quarterly basis to keep a pulse on their needs, goals and concerns.
After identifying several emerging trends in the survey data, UBS
decided in 2012 to create the UBS Investor Watch to track, analyze
and report the sentiments of affluent and high net worth
investors.
Methodology
For this 15th edition of UBS Investor Watch, 2,971 affluent and
high net worth investors responded to our survey from March 10 –
22, 2016. The core sample of 2,050 investors have at least $1
million in investable assets, including 479 with at least $5
million. With 93 survey respondents, we conducted qualitative
follow-up interviews. This UBS Investor Watch also includes an
oversample pf 1,131 Millennials:
- Respondents ages 21 – 29 who have at least $100,000 in
household income or $100,000 in investable assets
- Respondents ages 30 – 36 who have at least $250,000 in
investable assets
The sample was weighted by gender within each generation to
match the U.S. population.
Notes to editors
About UBS Wealth Management Americas
Wealth Management Americas is one of the leading wealth managers
in the Americas in terms of financial advisor productivity and
invested assets. It provides advice-based solutions and banking
services through financial advisors who deliver a fully integrated
set of products and services specifically designed to address the
needs of ultra-high net worth and high net worth individuals and
families. It includes the domestic U.S. and Canadian business as
well as the international business booked in the U.S.
About UBS
UBS is committed to providing private, institutional and
corporate clients worldwide, as well as retail clients in
Switzerland, with superior financial advice and solutions while
generating attractive and sustainable returns for shareholders. Its
strategy centers on its Wealth Management and Wealth Management
Americas businesses and its leading universal bank in Switzerland,
complemented by its UBS Asset Management business and its
Investment Bank. These businesses share three key characteristics:
they benefit from a strong competitive position in their targeted
markets, are capital-efficient, and offer a superior structural
growth and profitability outlook. UBS's strategy builds on the
strengths of all of its businesses and focuses its efforts on areas
in which it excels, while seeking to capitalize on the compelling
growth prospects in the businesses and regions in which it
operates. Capital strength is the foundation of its success.
UBS is present in all major financial centers worldwide. It has
offices in more than 50 countries, with about 35% of its employees
working in the Americas, 36% in Switzerland, 17% in the rest of
Europe, the Middle East and Africa and 12% in Asia Pacific. UBS
Group AG employs about 60,000 people around the world. Its shares
are listed on the SIX Swiss Exchange and the New York Stock
Exchange (NYSE).
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Media inquiriesNew York:UBSGregg Rosenberg,
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