How Different Generations Can Apply Their Money Lessons


Each of us belongs to a generation that has unique viewpoints. Looking for a mentor in a different generation can open up new learning opportunities.

Small girl with mother and grandmother taking selfie outoors on top of mountain.

Each of us is a member of a generation that shares values and attitudes that have been shaped by meaningful events during our lifetime. Although these values and attitudes can sometimes be quite different in older and younger groups, the differences can open the door to opportunities for learning and working together for the benefit of future generations. In addition, connecting younger and older folks from all generations can be a great way to gain perspective and see some of life’s challenges through a different lens.


Generations by definition

Baby boomers and millennials are the two largest generational groups today. Millennials, sometimes called Gen Y, were born between the years 1981 and 1996. They’re the largest demographic: just over 72 million people, representing 22% of the population.1 Baby boomers were born between 1946 and 1964 and make up 21% of the population. They’re the second-largest group, with roughly 70 million people.

Baby boomers aren’t the oldest generation today, though. That honor belongs to the silent generation, whose members were born between 1928 and 1945. Gen X is sandwiched between boomers and millennials, and Gen Z is the youngest complete generation, with members born between 1997 and 2012. People born after 2012 are members of generation Alpha.

Silent Generation 1928–1945
Baby Boomers 1946–1964
Generation X 1965–1980
Millennials 1981–1996
Generation Z 1997–2012

Source: Pew Research

Core investment philosophies, values related to work–life balance, and the ways that different generations use technology provide just a few opportunities for us to learn more from one another. Here are three hard-learned money lessons that any individual, regardless of generation, can apply:


1. Have patience for bear markets and long-term investing

Many members of the silent generation and baby boomers have patience after navigating a variety of market conditions. From the time when the oldest boomers were reaching adult age in the late 1960s until today, 10 bear markets (typically a decline of 20% or more) have rattled the country. Millennials have experienced only a few, and the most recent—the March to April 2020 COVID-19 bear market—lasted just 33 days.

Younger investors often prefer the convenience of trading online and using apps. As with the “meme stock” and crypto frenzy in 2020–2021, many millennial investors were lured into markets by the prospect of exponential returns in high-flying assets. The idea of long-term market returns (a staple of value investing philosophies that many boomers learned from folks like Ben Graham, Peter Lynch, and Warren Buffett) doesn’t carry the same thrill as Bitcoin, GameStop, or the latest big mover of the day.

Yet, the focus on instant gratification can lead to unrealistic expectations and disappointment. Older generations are more likely to follow a balanced long-term approach because history shows that it takes time to build a nest egg for generational wealth. For many boomers, for example, riding out the bear markets was simply the price paid for potential long-term positive returns.


2. Strive for a positive work–life balance

Because their parents lived through the Great Depression, many boomers were taught to embrace and value hard work. It was common for older generations to take a job with a company after college and remain there for most of their career, prioritizing the employer and work over other aspects of life. The economy rewarded many of these hard workers because they were able to buy a home, live stably, and participate in a pension plan. But with many of them working long hours at a mid- or senior-level position, 80% of boomers report having high levels of stress.2

Gen X are the children of boomers and, unlike their parents, are less likely to remain at the same place for their entire career. Switching companies is common when there’s dissatisfaction with an employment situation. They’re also more likely to take a break for a child’s baseball game or simply for a Friday afternoon off. Some say the term “work–life balance” began as a Gen X value.

It’s a widely held belief that boomers live to work and younger generations work to live. That is, they work to sustain a lifestyle and enjoy their experiences. Millennials are more likely to seek out companies that share their values and offer opportunities for more socializing. Employers have responded by offering gym memberships, Friday happy hours, and philanthropic projects. The challenge for many in the younger crowd is that once they’re immersed in a career, it becomes difficult to get away entirely from work—because they’re always connected through social media, mobile devices, and email.

Although many boomers have reached retirement age, some are still in the workforce, so we now have four generations working at the same time. When it comes to work–life balance, we can all learn something from each generation. While changing a job or employer midcareer is more common today, remaining with the same company for a long stretch and maximizing any qualified retirement plans (especially when the company matches the contributions) is often the optimal way of building long-term retirement savings. Also, while few companies are offering the pension plans of 20 years ago, the job market has evolved so that both parents can be breadwinners with competitive benefits, generous paid time off, and work-from-home or hybrid situations. Flexible work arrangements can help reduce stress and burnout, which can contribute to a better work–life balance.


3. Be tech savvy but use good judgment

Millennials are considered the first truly connected generation because of their grasp of the digital world. Have you ever experienced a situation when a boomer refuses to ask directions but a nearby Gen Z instantly pulls it up on an app such as Waze or Google Maps? They’re expected to be more tech savvy and resourceful.

At the same time, boomers know how to keep their financial and personal information private. According to a survey from Webroot, 59% of millennials share travel plans on social media, while 71% of boomers don’t.3 A survey from Wakefield Research shows that 78% of millennials have shared sensitive information over public Wi-Fi, compared with only 33% of people older than 65.4 The risk of course is that hackers can sometimes pose as a public network to steal information (ex: password, credit card number, banking information) that passes from the user and through the network server. Technology is an important part of our day-to-day lives and will continue to grow from one generation to the next. But remaining vigilant and practicing cybersecurity hygiene can be cross-generational strategies for keeping the fraudsters at bay.

We’re all members of a generation and shaped by the values and attitudes of our peers. Sometimes looking through the lens of a different generation can open us up to ideas and viewpoints we’d otherwise miss. Take time to find a mentor in a different generation and listen to what they say. If you’re a millennial, share this article with a grandparent; if you’re a grandparent, share it with a grandchild. Get the conversation started. Older generations have a great deal of experience to share, and younger generations can offer different perspectives as well. Working together can benefit not only ourselves but also the generations to come.

Mercer Advisors Inc. is the parent company of Mercer Global Advisors Inc. and is not involved with investment services. Mercer Global Advisors Inc. (“Mercer Advisors”) is registered as an investment advisor with the SEC. The firm only transacts business in states where it is properly registered or is excluded or exempted from registration requirements.

All expressions of opinion reflect the judgment of the author as of the date of publication and are subject to change. Some of the research and ratings shown in this presentation come from third parties that are not affiliated with Mercer Advisors. The information is believed to be accurate but is not guaranteed or warranted by Mercer Advisors. purposes only. For financial planning advice specific to your circumstances, talk to a qualified professional at Mercer Advisors.

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