Generation X, now between the ages of 43 and 58, may take a different approach to banking than the generations they fall between. This is because members of this generation may be more financially secure than millennials, who are still relatively early in their careers but have different financial needs than boomers, many of whom are already of advanced age. to retire.
See the List: The Best Banks of 2023 according to GOBankingRates
Find out: Do you have too much money in your checking account?
Check Out: GOBankingRates Best Online Savings & Neobank Accounts in 2023
To shed some light on how Gen X operates, GOBankingRates conducted a survey on Gen X preferences and behaviors. Here’s a look at how Gen X approaches the bench in 2023.
Gen Xers prefer national banks
There is now a wide variety of financial institutions to choose from, from national banks to regional banks, online-only banks, and neobanks. Gen X favors national banks, with nearly a third (31%) choosing this option. Online banks were a close second, with 24% of Generation X opting for these institutions. Additionally, 20% use a local bank, 14% use a credit union, and 11% use a regional bank.
“Convenience is the big draw for Generation X with national and online banks,” said Johan Romero Luna, senior vice president at Hanscom Federal Credit Union. “When it comes to convenience, national banks and online banks have done a good job advertising the benefits and time savings they can offer, as well as the cost savings online banks can pass on to customers with no overhead. of physical presence”.
Gen Xers have different accounts at different banks
The majority of Gen X (63%) said they would have different accounts at different banking institutions.
“Gen X consumers typically implement a diverse set of financial products and are likely to take an active role in managing their money by seeking solutions that work best for them, regardless of the financial institutions that offer them,” said Dr. David Yours. , CEO of University Credit Union. “It’s not uncommon for Gen X banking customers to have accounts at multiple banks or credit unions.”
Take Our Survey: How Big A Sign Up Bonus Would You Need To Switch Banks?
Gen Xers prefer to bank through their phones
Members of this generation prefer to bank through the mobile app (57%) compared to in person (18%) or online (24%).
“Compared to baby boomers, Gen Xers are significantly more comfortable with technology, which shapes the way they like to interact with financial institutions and gives them a preference for using mobile apps over in-person interactions. said Yours.
Generation X may be especially drawn to mobile banking because of the time it can save compared to banking in person.
“Most are in the most productive years of their professional lives, so time is an important factor when making financial decisions,” Luna said. “Saving time has become paramount in our current era, and having access to coordinate and manage your banking needs from your mobile devices has become routine due to the easy access and capabilities of smartphones and mobile banking apps” .
Gen Xers are loyal to the financial institutions they chose
A majority of Gen Xers said they haven’t considered switching banks in the past year (58%) and that they like their current institution and don’t want to switch (51%).
“The institutional loyalty trend didn’t surprise me,” said Devesh Khare, chief product officer at MeridianLink, a digital lending platform. “Market research has established that, in general, brand loyalty is highest among Generation X consumers. They have a high affinity for brands that have earned their trust and are willing to pay more for products of those brands. This preference for established brands also sheds light on why the majority of Generation X consumers still bank with national institutions.”
Luna thinks this may have less to do with loyalty and more to do with not wanting to deal with the hassle of changing. In fact, nearly a quarter of Gen X respondents said the most important factor why they stay at their current bank is that they believe the switch process will be difficult and time consuming.
“The complexity they live in makes it more difficult to change banking relationships because of the amount of time it can take to change payroll, invoices, automatic payments and deposits, and more,” Luna said. “It takes a big disagreement or issue to get most Gen Xers to switch accounts, even when there might be a better offer.”
Gen Xers keep low balances in their bank accounts
This generation maintains low balances (less than $100) in both their checking and savings accounts: 46% maintain a minimum of less than $100 in their checking accounts and 45% have less than $100 in their savings accounts.
“The challenging economic environment that began during the pandemic is a major factor why many Generation X consumers have so little in their checking and savings accounts,” Khare said. “Many members of Generation X are raising families, providing financial support to an adult child or caring for an aging parent. The financial demands of those commitments, combined with the potential loss of income during the pandemic, would have created a challenging financial situation for almost anyone.”
Approximately half of Generation X have not written a check in the last year
Gen Xers are in their 50s and 50s when it comes to writing checks: 49% have not written a check in the past year.
“Technology has sped up the way we live our lives, and with that has come the convenience of paying bills online,” Luna said. “It has become a more effective, efficient and secure method compared to checks or cash. It is one of the biggest changes in banking in the last 30 years, and now anyone with a bank account can initiate, send and receive payments in a timely manner without barriers.”
More GOBankingRates Content
Methodology: GOBankingRates surveyed 1,000 Americans age 18 and older from across the country between December 7 and December 12, 2022, asking 19 different questions: (1) What category is your current financial institution in?; (2) Have you considered changing banks in the last year?; (3) If you have considered changing banks in the last year, was it any of the following factors? (Select all that apply); (4) What feature, benefit, or other offer is most important to you when opening an account at a new institution?; (5) Are you currently satisfied with all banking products and services offered by your bank/credit union?; (6) Would you ever have different types of accounts at various banks? (ie, checking at Chase, but savings at TD Bank); (7) What is your preferred banking method?; (8) Which of the following is the most important factor for you to stay at your current bank?; (9) Which of the following bank accounts do you currently use or have open? (Select all that apply); (10) What is the minimum balance that you maintain in your current account?; (11) How much do you currently have in your savings account?; (12) How much of a sign-up bonus would make you consider changing banks; (13) Have you considered using app-only banking platforms (also known as neobanks) in the last year (eg Current, Upgrade, Chime, Dave, etc.); (14) How important is it to you that your bank is affiliated with a cryptocurrency exchange/platform?; (15) In the last year, how often have you written a physical check?; (16) When was the last time you personally visited your bank?; (17) Why would you choose to visit your bank in person? (Select all that apply); (18) When you think of banking, do you think of it as something you need or don’t need?; and (19) What services/products do you expect from your bank and/or credit union? (Select all that apply.) GOBankingRates used the PureSpectrum survey platform to conduct the survey.
This article originally appeared on GOBankingRates.com: 6 Banking Habits That Define Generation X
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.