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How Do Different Generations of Clients Think?

Jun 15th 2017
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People value money differently. This confounds many people. Your client assumes waving a large upfront bonus will get someone to leave their current firm and work for you. Sometimes it doesn’t work. Your children may spend money like water. They assume you are an ATM machine with legs. What happened to values?

How Do Seniors and Baby Boomers View Money?
Thinking demographically, seniors are age 70 and older. Baby boomers follow, ages 50 to 69. Boomers sired Generation X, ages 30 to 49. They gave us Generation Y, ages 10 to 29. This blurs somewhat because we invented millennials, who are 18 to 34 years old.

Most seniors lived through the Great Depression, a period of deprivation unequaled in the United States since. They probably never throw anything out. They experienced rationing in World War II. In 1943, the British had an expression: “Make do and mend.” Boomers may not have experienced the Depression, but they were probably reminded enough by their parents.

A financial planner in Bucks County, Pennsylvania explained how generations think differently. Seniors and boomers were raised in a climate of delayed gratification. It’s the have-do-be culture:

If you have enough money
To do what you want
Then you will be happy.

This was a powerful motivator for wealth building and saving. When defined benefit pension plans were the norm, people would work until age 65, when they retired. Then they would start living. Their spouse might be missing out on exotic holidays, but all this will change. After retirement, we will travel. You’ve heard the stories of people who missed out on the fun because they dropped dead.

How Does Gen X and Gen Y View Money?
They view money differently. There was no Great Depression in their lifetimes. They belong to the be-do-have culture. Here’s one way of looking at it:

Determine who you want to be.
Do things in alignment with that outlook.
Then you will have happiness.

Money isn’t mentioned. Being happy doesn’t require lots of it. There isn’t the motivation to do a job that’s boring because it provides a paycheck. Successful Gen Xers might work in IT or be game designers. Others might be musicians or work for a nonprofit. The job is its own reward. They are happy.

Stepping into the work environment, this mean the IT folks will leave a job if they are unhappy. This is even a bigger risk if their skill is in demand. The musician or the person working at the nonprofit finds their work fulfilling. They don’t see a need to climb the corporate ladder. They distrust corporations.

How Does This Concern Accountants?
Everyone must file taxes. Many come to you. You see what the future is likely to hold for them. For Gen X and Gen Y, there are weddings and college education expenses in the future. This takes planning. How are you going to motivate them to start early?

Seniors and baby boomers are easier. They get it. They understand the value of money. However, baby boomers also invented conspicuous consumption. Are they prepared for retirement? An estimated 10,000 boomers turn 65 every day.

Related article:

What Keeps Senior and Baby Boomer Clients Awake at Night?

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