Searching for some optimism? Millennial retirement hopes might be hogging it all.
The average Millennial expects to retire at age 56, according to a new study. And over half believe they’ll become millionaires at some point.
TD Ameritrade’s 2018 Millennials and Money Survey unearthed an overwhelming amount of optimism radiating from this generation. Yes, the same group that is in a collective $1 trillion of debt, stemming from student loans, credit cards and other sources.
More hopeful yet, Millennial men say they plan to retire even earlier, at age 53.
Realistically, early retirement may prove more challenging than anticipated—especially since just 38 percent of Millennials surveyed are currently saving in a 401k or other account. On average, the cohort doesn’t expect to begin contributing to retirement savings until they are 36.
A little over a quarter (28 percent) of respondents aren’t on the same page as the others. So much so, they don’t anticipate retiring at all.
“One of the greatest investments young people can make in themselves is to start putting money away in their 20s. Because of the power of compounding (Einstein called it the eighth wonder of the world), even with ups and downs along the way, those who start early potentially can end up with more in the end,” JJ Kinahan, chief strategist for TD Ameritrade, said in a statement.
Fortunately, the survey found more Millennials consider themselves savers in 2018 compared to 2016, 70 percent versus 62 percent. A quarter have even started to save for their children’s or grandchildren’s education.
“Ideally, it would be wise to start [saving for retirement] right after college, and while some Millennials certainly do that, we realize that’s not always possible. Understanding all of the available alternatives, like employer-sponsored retirement accounts or brokerage accounts, can be a step in a right direction,” Kinahan added.
It remains to be seen whether this generation will realize the dream of walking away from work earlier than the majority of their elders. But perhaps other ways in which Millennials are blazing their own trail will help their cause.
For instance, around one in four don’t expect to get married and don’t see themselves owning a home. A third aren’t planning to have kids. And 53 percent think they’ll eventually be millionaires.
“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,” Kinahan concluded.