The majority of young Americans lacks confidence in the future of Social Security, according to the most recent GenForward study from the University of Chicago. The survey found this sentiment to be strongest among African Americans and Latinos.
The study report notes, “While there are debates among experts about the financial stability of Social Security, it appears that most young adults are pessimistic that the system as currently constructed will exist into the future.”
Despite their pessimism, Social Security remains a portion of Millennial’s plans for living in retirement. Fifty-seven percent of Asian Americans reported they plan to rely on Social Security when they retire. That figure is 48% for African Americans, 53% for Latinos and 46% for whites.
Asked what type of retirement savings or pension they have, the most common response in each racial and ethnic group is that Millennials have no retirement savings or pensions. Whites and Asian Americans are most likely to have a 401(k) or other defined contribution (DC) plan through an employer, and most likely to also have retirement savings outside a retirement account (though African Americans are most likely to have a defined pension through an employer).
The majority of Millennials in each ethnic group lack confidence they will be able to retire when they want to (61% of Latinos, 60% of African Americans, 54% of Asian Americans and 52% of Whites).
A significant amount of optimism was reported when it came to whether Millennials will be better off financially than their parents. When asked, “In terms of household finances, do you think you will eventually do better or worse than your parents have done?” 76% of Latinos agreed, as did 62% of African Americans, 65% of Asian Americans (65%) and 47% of Whites.
However, the study report concludes that “many whites feel that they are experiencing economic stagnation or decline, while African American, Latino and Asian American Millennials perceive that their economic standing is likely to improve on that of their parents.”
“A Report on the Lived Economics of Millennials,” can be found at GenforwardSurvey.com.