Since 2000, when Prudential began tracking this measure in its
study on The Financial Experience and Behaviors Among Women, there has been
no significant change in women’s confidence levels in achieving their
financial goals. Boomers (ages 43-61) registered a confidence gap of 83 points,
with Matures (ages 62-68)* right behind at 79 points. The confidence gap among
GenXers (ages 30-42) and Millennials (ages 25-29)*,was 75 points and 83 points,
respectively--surprising considering these groups have more time to plan and
save.
“We continue to see high levels of awareness across generations
of women, which is encouraging,” says Lori High, President of Prudential’s
Group Insurance. “They understand the issues, and are doing their homework.
The fact that this awareness is not translating into action, and women are not
taking steps to mitigate the potential outcomes associated with longevity—like
outliving their savings or becoming a financial burden—remains a big concern.”
Demonstrating their awareness, a surprising 36% of Millennials
(ages 25-29) and 34% of GenXers (ages 30-42) are in fact giving serious thought
to what it takes to prepare for retirement. Retirement is also a top-of-mind
consideration for 28% of Boomer women (ages 43-61) who participated in the study.
Women do rely on a trusted network for information and advice,
and actively seek counsel. More than half named a financial advisor (34%) or
friends and family (19%) as their most preferred source for learning about financial
products. This desire for face-to-face contact is consistent with what Prudential
has reported in previous studies. Across the generations, an overwhelming 80%
of Millennials show the most propensity for relying on friends and family for
guidance, yet the Internet is equally important—at 79%. In fact, the difference
in using the Internet as a top resource for financial planning information is
quite extreme across the generations: It drops to 67% among GenXers and then
to less than half among Boomers (46%) and Matures (45%).
The 2008 study also found a financial product knowledge gap
persists. Although women across generations demonstrated a firm grasp of insurance
products (29%) and workplace retirement plans (28%), a steady drop in understanding
of mutual funds (15%), long-term care insurance (13%) and annuities (10%) occurred.
Matures (women ages 62+) demonstrated more knowledge across the board, suggesting
that some understanding does come with age.
Prudential Financial’s 2008 Study on The Financial Experience
and Behaviors Among Women polled 1,033 American women about their financial
knowledge, actions taken and confidence in attaining their financial goals.
Other highlights of the survey, administered from October 17 to 25, 2007, include:
* Feeling prepared to make financial decisions does not necessarily
come with age. Just one in five Boomers, GenXers and Millennials feel “very
well prepared,” compared to two in five Matures.
* Women are demonstrating personal accountability. In reporting
their expected sources of retirement income, roughly two-thirds of women indicated
their own personal savings, over government support and/or a systematic workplace
savings plan. Not surprisingly, only 35% of Millennials expect to rely on Social
Security, vs. 91% of Matures.
* Retirement savings progress improves with preparedness. Forty
percent of women “ahead” in their retirement feel very well prepared
to make important financial decisions compared to just 7% of those “very
behind.”
Prudential’s 2008 Study on The Financial Experience and
Behaviors Among Women is available at www.prudential.com/women.
Prudential Financial, a financial services leader with approximately
$631 billion of assets under management as of March 31, 2008, has operations
in the United States, Asia, Europe, and Latin America. Leveraging its heritage
of life insurance and asset management expertise, Prudential is focused on helping
approximately 50 million individual and institutional customers grow and protect
their wealth. The company’s well-known Rock symbol is an icon of strength,
stability, expertise and innovation that has stood the test of time. Prudential's
businesses offer a variety of products and services, including life insurance,
annuities, retirement-related services, mutual funds, investment management,
and real estate services. For more information, please visit www.prudential.com.
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