Will millennials ever be able to retire? That depends on who you ask. Some reports on young people’s retirement readiness are all doom and gloom. A 2015 UBS Investor Watch report found that millennials are the “least likely to plan ahead, focus on the long term, stay calm during volatility, and avoid herd mentality.” Many have limited knowledge of key financial concepts and are more likely to keep a lot of their money in “safe” investments like cash, both of which could make it harder to save enough money to one day retire.
Yet some take a more positive view of millennials’ financial future. A 2014 report from the Transamerica Center for Retirement Studies declared this group an “emerging generation of super savers,” most of whom are already preparing for retirement and are concerned about their long-term financial future.
The retirement reality for today’s young workers is likely somewhere in between being perfectly healthy and a looming crisis. Some millennials are doing a great job of preparing for retirement, while others are far behind. That’s not so different than most other Americans. Many seniors face a bleak financial future, while members of generation X are having trouble building wealth despite relatively high incomes.
One fact is clear, however. If millennials ever hope to retire, they need to start planning sooner rather than later. That doesn’t just mean saving for retirement; it also involves paying down debt, creating an emergency fund, and keeping an eye on spending. Need a little motivation to get your financial house in order? Here are seven retirement statistics that will help give millennials a better idea of what their financial future may hold.
1. Many millennials will have to delay retirement
Once upon a time, people dreamed of retiring at 55. Now, people are more likely to put off retirement until their 60s, according to a Gallup poll. Research by NerdWallet has found that millennials may have to wait even longer to stop working, likely around age 73, largely because of high levels of student loan debt.
Despite predictions that they’ll have to work into their 70s, many millennials believes they’ll be able to retire sooner. Twenty-six percent expect to retire around age 65 and 34% plan to retire even earlier, according to the Transamerica Center for Retirement Studies. However, half of them also expect to continue working after they retire.