Boomers are saving twice as much for retirement as Millennials, with a median of $300 vs. $150 per month and despite the fact that Millennials are saving for other things, more than two-thirds (72%) have already started saving for retirement. This is according to the TD Ameritrade Millennials and Money Survey of 2,100 U.S. adults identified as either savers or spenders.
“While we’ve learned that the majority of Americans have positive savings habits, we can’t ignore the fact that a significant number of non-savers find long-term saving to be difficult, if not impossible,” Dara Luber, a retirement and long-term investing professional at TD Ameritrade in New York. For example:
- Of those who aren’t saving, two-thirds (67%) of Millennials and more than half (56%) of Boomers say they can’t afford to save
- More than a quarter (26%) of non-retired Boomers expect that they will never fully retire, along with 23% of Millennials
- 14 percent of Millennial spenders say they are spenders because they have so much debt, they don’t care about saving anymore
- Millennials hold more non-mortgage debt at $15,000, than Boomers do at $10,000
- Four in 10 (39%) of Millennials are paying off student loans by making median monthly payments of $200
According to the research, 82% of Millennials are saving for something other than retirement, such as vacation or an emergency fund while 80% of Boomers, who are nearing a time when they may no longer work, are saving primarily for retirement.
“Everyone needs to start somewhere, and a commitment to a regular long-term savings plan – no matter how small – is well worth the effort,” Luber said. “If your end goal seems daunting, break it down into smaller goals and celebrate milestones along the way. Use these small happy moments as motivation toward your big money goals like retirement.”
TD Ameritrade’s 2016 Goal Planning Survey shows that people who have a savings plan with specific goals are more likely to make progress toward fulfilling their savings or investing targets.
One in four Millennials are saving for a down-payment on a home, almost one in five (18%) are saving for education and one in 10 for a wedding/civil ceremony.