Millennials have high expectations about when they plan to retire and how much they plan to retire with, but achieving their desired goals will take some adjustments, according to new survey results.
TD Ameritrade’s 2018 Millennials and Money Survey of more than 1,500 adults ages 21 to 37 finds that on average, Millennials expect to retire at age 56 (men at age 53 and women at age 59). Yet large cohorts of the generation said they do not plan to start saving for retirement until age 36. At the same time, more than a quarter (28%) said they do not expect to retire at any point.
Currently making up the largest generation in the workforce, Millennials are optimistic about how their lives will play out after college, despite having a collective $1 trillion in student loan, credit card and other debt (the findings show that respondents hold on average nearly $15,000 in debt).
“This is a financially optimistic group that’s feeling positive about the economy, the job market and their own plans. However, they will need to develop saving and investing habits that will help them reach some pretty big goals,” notes JJ Kinahan, chief strategist for TD Ameritrade.
Meanwhile, more than half (53%) of Millennial respondents on average say they expect to become millionaires at some point, but the male/female breakdown for this question revealed a large gap: More than 7 in 10 (73%) male Millennials expect to become a millionaire at some stage in their lives (or are already a millionaire), while only 4 in 10 (38%) female Millennials say the same.
The proportion who see themselves as “savers” as opposed to “spenders” is increasing, however. The findings show that more Millennials rate themselves as savers than did in 2016 (70% versus 62%). In addition, 94% of respondents say they are saving for a specific goal, with vacation (43%) and emergency funds (39%) being the top choices, followed by retirement (38%) and their children’s education (25%).
As to their savings habits, the findings show that half of Millennial respondents invest in the stock market and half do not. Male Millennials (66%) were much more likely than female Millennials (39%) to invest in the stock market.
When asked about their investing knowledge, Millennials did not rate themselves very highly. According to the results, just over 3 in 10 (32%) respondents rate their investing knowledge as very knowledgeable. Again, there appears to be a wide discrepancy between males and females, with nearly half (49%) of males rating their knowledge as very high compared to 19% of female Millennials.
Other findings of the survey show that:
- 24% said they don’t expect to get married, and nearly the same don’t expect to own a home;
- 30% don’t expect to have kids;
- 17% have not yet achieved financial independence from their parents; and
- 20% say they are never going to be able to pay off their student loans.
The online survey was conducted with 1,519 American Millennials ages 21 to 37 by Head Solutions Group between Feb. 21 and March 7, 2018, on behalf of TD Ameritrade Holding Corporation.