Millennial using his cell phone at the train station believes that retirement sucks

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They’re out-saving Baby Boomers and Gen Xers, not to retire — but to work their dream jobs and travel.

Millennials are saving, but not for retirement — for the much nearer future. They think they’ll be worse off in retirement than their parents because they expect Social Security will be less generous and health benefits will be worse.

Instead, 63 percent of them are saving their money for financial freedom to travel and work their dream job rather than retire and leave the workforce, says investment group Willis Towers Watson.

One in 8 feel they’ll work until they die anyway — so they might as well be at a job they care about.

“This spring’s report shows us even more differences between how millennials and their parents view and save for the future,” says Aron Levine, head of Merrill Edge. “Young adults tell us they are willing to do whatever it takes to achieve freedom and flexibility, even if it means working for the rest of their lives.”

Why wouldn’t millennials want to retire?

It may not be that millennials don’t want to stop working, they may just be more skeptical as to whether they’ll have the ability to.

Millennials say they prefer a job that gives them personal fulfillment over high pay. They also prefer a higher salary over a stronger retirement plan.

Millennials believe that America’s retirement system is under stress (93 percent) and needs reform (86 percent), says the National Institute on Retirement Security.  Those numbers are higher than for the general population.

Eight in 10 millennials feel that Social Security will not be there for them when they come to retirement age. Even though almost three quarters of them have started and almost half feel they will self-fund their retirement through a 401(k), IRA, or other savings. Many just won’t be using this funding to stop working.

Living for the moment

Millennials are choosing to save for short-term goals more than long-term ones, and apparently they don’t notice how well they’re doing at it.

Only 15 percent say they’re “doing a good job” at saving, but according to the Merrill Edge report they save 36 percent more than their Baby Boomer and Gen X counterparts. Over one-third set aside more than 20 percent of their salary per year, compared to most Americans who set aside half of that annually.

When they’re not socking money away for their “financial freedom,” most focus on enjoying the here and now. Millennials are more likely to spend money on travel (81 percent), dining (65 percent), and fitness (55 percent).

Millennials aren’t the only generation losing interest in saving for retirement. Nearly a third of Americans say they aren’t saving for retirement at all, and most Americans prioritize short-term goals more than their “golden years.”

A recent survey from the American Institute of CPAs says almost half of Americans are stressed they won’t meet their retirement goals by the time they hit retirement age.

They’re worried about having enough saved to make it to the end. Their biggest concerns are health care costs (71 percent), Social Security uncertainty (62 percent), being able to afford our day-to-day bills (67 percent), and knowing how much we will need to retire (70 percent).

“Working throughout your life was once a reliable route to a comfortable, financially secure retirement,” says Greg Anton, chair of the AICPA’s National Financial Literacy Commission. “We’ve found that today, even Americans who say they’ll reach their financial goals are anticipating a more active ‘retirement-lite’ that involves working and making financial sacrifices.”

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Meet the Author

Joe Pye

Joe Pye

Associate editor

Pye is the associate editor of


401k, millennials, save money

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