Great Depression and Great Recession—individuals who came of age in each show distinct retirement investing behavior based on what they experienced.
For the latter, it’s an understandable lack of trust in financial services institutions and a “do-it-myself” mindset as they continue to pursue financial independence and self-sufficiency.
According to the latest Merrill Edge Report, when asked what they’ll be able to rely on in 20 years, millennials’ top response was their savings account (66 percent)—including 401ks and other retirement plans, which are self-created and self-funded sources.
In fact, millennials place greater trust in their own stewardship than they do in their personal relationships with their significant other (57 percent) and friends (56 percent).
Their do-it-myself mindset is evident in their willingness to save a significant portion of their paycheck; 38 percent of millennials say they are willing to save more than 50 percent of their own paycheck to have more money in the long run.
In sharp contrast, older generations are more likely to depend on outside sources for their financial security, such as employer- or government-funded accounts.
For Gen Xers, this means relying on a 401k account (71 percent), while baby boomers are more likely to rely on pensions (54 percent) and Social Security (50 percent).
This proactive and deliberate planning appears to manifest itself as conservatism for younger Americans. After witnessing the fallout of the years following the recession and the effects it had on their older generational counterparts, millennials are more likely to “play it safe” with their day-to-day investments, more so than other aspects of their life, including their career, romantic life and travel.
The report also found millennials are most likely to see themselves as financially conservative compared to others, including their parents and grandparents.
Americans overall appear unified in thinking success and wealth are in the cards for them.
Ninety-six percent deem success attainable, with 52 percent considering themselves successful already and 44 percent thinking they will be in the future.
Many even take it a step further, as 54 percent think they will be wealthy during their lifetime, including 8 percent who already consider themselves wealthy.