By Cyril Tuohy
Call it the irony of the modern family — and the opportunity of tomorrow’s advisors.
Nontraditional families are more likely than traditional families to talk to their children about personal financial issues, yet nontraditional households are also less likely to rely on professional help to build a financial plan, a new Allianz survey shows.
The survey results point to “a historic opportunity” for advisors to help guide families on the path to financial health, said Gary C. Bhojwani, a member of the Allianz SE management board.
“Although the overwhelming majority of American families have experienced financial stress in recent years, potentially affecting their ability to meet their financial goals, it’s clear that modern families have other unique factors impacting how they approach and think about financial planning,” Bhojwani said in a news release.
Results were part of the LoveFamilyMoney survey of 4,500 Americans ages 35 to 65 with annual household income of more than $50,000.
Nontraditional families — families headed by same-sex couples, families where adult children or aging parents have come to live, families with in-laws and cousins living under one roof — are becoming more common in the U.S.
Traditional families are defined as families where the spouse is married to a partner of the opposite sex with at least one child under the age of 21 and belonging to them living in a household.
The survey found that 54 percent of nontraditional families talk openly about their personal financial situation, compared with 47 percent of traditional families. The survey also found that 47 percent of nontraditional or “modern” families have encouraged their children to invest and save for their own retirement goal, compared with 38 percent of traditional families.
But only 43 percent of modern families said they have ever used a financial professional, compared with 53 percent of traditional families, the survey found.
U.S. households are changing rapidly.
As courts overturn bans on same-sex marriage, as more older Americans rely on their children for care, as the nation’s increasing ethnic diversity gives way to extended households and as the number of children raised in single households increases, the number of people living in nontraditional family structures is expected to rise.
Modern families are more likely to be struggling financially than traditional families, the research found.
As many as 26 percent of nontraditional families said they “don’t make enough money to think about financial planning for the future,” compared with 18 percent of traditional families. Nearly one-third of modern families also said they have too many expenses to deal with to think about planning for the future, compared with 26 percent of traditional families, the survey found.
Cyril Tuohy is a writer based in Pennsylvania. He has covered the financial services industry for more than 15 years. Cyril may be reached at [email protected].
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