Optimism or blind spot: Two-out-of-three Millennials look to retire by age 65
The Millennial mindset seems to take its literal and unironic cue from the 1986 Timbuk 3 one-hit wonder, “The Future’s So Bright, I Gotta Wear Shades.” But a recent nationwide survey conducted by TheStreet’s MainStreet.com suggests they might want to change those shades to glasses, the better to focus on retirement.
The survey found that almost 70 percent of Millennials have not taken any action to plan or save for retirement. Not that they are completely myopic about their projected source of retirement income. Concerns about the sustainability of Social Security no doubt account for a significantly less proportion of Millennials than Baby Boomers (54 percent vs. 85 percent) counting on Social Security as their primary source of retirement income.
Given persistently high unemployment, a challenging job market and the burden of student loans, Millennials’ sunny outlook is somewhat surprising. But a first quarter wealth level study conducted by Spectrem’s Millionaire Corner of investors with a net worth between $100,000 and $1 million found that Millenials were significantly more likely to say that their financial situation is better today than it was one year ago (57 percent vs. 48 percent of respondents overall) and that they expect to be better off financially a year from now (67 percent vs. 46 percent).
The MainStreet.com survey further found that two-in-three Millennials plan on retiring at age 65. This is consistent with Millionaire Corner research that finds the highest percentage of Millennials plan to start taking their Social Security benefits at their full retirement age.
Of Millennials who have started retirement savings plans, nearly two-thirds (64 percent) report saving in employee-sponsored retirement plans. A near equal percentage (63 percent) are counting on bank savings accounts, money markets and CD plans as their primary sources of retirement income. In comparison, 65 percent and 61 percent of Boomers, respectively, cited those sources, far below the expectations for Social Security.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.