by WEX Health
Last week, we announced that we would publish a series of blog posts exploring the unique healthcare needs and communication preferences of each generation. Whether you’re an HR professional, a third-party benefits administrator or an employer, our goal is to leave you better prepared to engage each generation with their healthcare benefits. First up: Baby Boomers.
Baby Boomers: A generational profile
If you were born between 1946 and 1964, then you’re a Baby Boomer, according to the Pew Research Center. This generation, now aged 54-72, acquired its name thanks to the surge in births after WWII. During that time period, nearly 77 million babies were born in the United States. That includes president Donald Trump and former presidents George W. Bush and Barack Obama.
Boomers, who represent roughly 23 percent of the American public, are currently duking it out with Millennials to determine who is the largest living generational group. However, there’s no doubt who holds the title of wealthiest generation in history. Having benefited from a long period of economic growth during most of their peak earning years, Boomers control 70 percent of all disposable income in the United States. By 2030, they’re expected to have over $53 trillion in wealth—about 45 percent of total household wealth. Further, nearly one in five Boomers has accumulated investable assets of over half a million dollars. On the other end of the spectrum, one-third of Boomers have nothing saved for retirement.
Health benefits concerns unique to Boomers
The first Boomers began retiring in 2012. Now, 10,000 Boomers retire each day. Already the longest-living generation in history, Boomers are expected to live 10 to 12 years longer than their parents did, which means they will consume an outsized portion of healthcare benefits and will require more money for longer retirements.
A Fidelity study predicted that a married couple retiring in 2018 can expect to spend a combined $275,000 on healthcare alone during retirement. Expenses of that magnitude explain why 65 percent of Baby Boomers say they plan to work past age 65 or do not plan to retire at all.
However, it’s important to look at Baby Boomers individually, not just as married couples, as the divorce rate among those 50-plus is spiking, and one in 11 (or about 8 million people) do not have a spouse, partner or living child. As a recent Wall Street Journal article explored, more Baby Boomers are aging alone than members of any other generation in U.S. history. The publication calls their social isolation “a public health threat” that costs Medicare $6.7 billion a year on nursing facilities and hospital stays for those without a network to care for them.
Tips for engaging Boomers with their healthcare benefits
- Find them online: Boomers aren’t exactly known for being tech whizzes, but failing to reach out to them digitally is a mistake. This generation spends more time online than they do watching TV in an average week. And a Google survey found that the internet is the primary way that Boomers now gather information about topics of interest. The majority also use social networking sites. To educate Boomers on their healthcare benefits, capture their attention with personalized online and mobile tools.
- Help them set and achieve their financial goals. In this age of increased longevity, it’s never too late to consider how to help Boomers achieve financial security, especially since so many face retirement with inadequate savings in the bank. Educate them about how to maximize their savings so they can save for future healthcare expenses while they’re still members of the workforce. Providing them with tools like a savings goal calculator or an online dashboard displaying their savings progress can go a long way to motivating them and helping them predict how much money to set aside.
- Target your benefits messaging specifically to Boomers. Create a personalized experience for older workers by emailing or texting them about concerns specific to their stage of life. Or, within your benefits portal, target them with resources and messaging that is relevant to them. For example, employees who are age 55 and above could be shown eye-catching banner ads reminding them they can make catch-up health savings account (HSA) contributions.
- Introduce them to the longterm savings capacity of an HSA. Participation in HSAs among eligible employees is soaring across age groups, including Boomers. In 2018, 85 percent of eligible Boomers were enrolled in an HSA. It’s important to educate the other 15 percent on the merits of an HSA, including its triple-tax advantage, ability to cover healthcare premiums and out-of-pocket expenses after age 65, and investment capabilities that make it a good place to save for retirement.
Stay tuned for our blog posts on Generation X, Millennials and Generation Z. And for more insights about how to ease workers’ concerns about the rising cost of healthcare, download our WEX Health 2018 Clear Insights Report.