(Forbes) Can Millennials even have a retirement? Truth is, yes! Even with tons of student debt and the Great Recession, Millennials are definitely slower than previous generations to put money aside. But they still have time—and some are saving big.
On Tuesday morning, #MillennialRetirementPlans began trending on Twitter. But why? The answer begins with a midnight hashtag roundup game that’s lead by @Radstags—whoever that is. Sometimes, these regular hashtag challenges trend on Twitter. The game only lasted 55 minutes, but the responses were still going strong 12 hours later. So it’s fair to say that #MillennialRetirementPlans hit a nerve.
The tweets range from hilarious to hurtful, but they highlight Millennials’ anxieties about their future and whether they can prepare properly for it. We looked through hundreds, maybe even thousands (we lost count after a while) and picked out some tweets we think you’ll find amusing—and also some myths to debunk.
But before we get to that, let’s make it very clear that Millennials are not today’s high schoolers. Those youths are the start of Generation Z, according to Pew Research. Millennials, also called Generation Y, are adults who were born between 1981 and 1996, so as of 2019 they are 23 (or soon to turn 23) to 38 years old. You may see some research institutes, such as the Center for Retirement Research (CRR) at Boston College, include those born into the end of ’99. Whichever end point you use, they are adults.
It certainly does seem like most Millennials are having a hard time saving for retirement. Between student loan debt and the catch-up game that the middle-to-oldest Millennials have had to play post-Great Recession, the outlook on retirement seems grim. But some Millennials are beating the odds and showing their peers how to do it.
Here’s the depressing truth: Despite handily outpacing earlier generations when it comes to earning college degrees, both male and female Millennials between the ages of 25 and 35 are behind where late Baby Boomers (those born in 1954 to 1964) and Gen X-ers were at the same age. That’s true by a lot of financial measures, including a comparison of their median earnings to median earnings in the workforce overall, according to CRR’s 2018 report “Will Millennials Be Ready for Retirement?” Put another way, it is taking Millenials longer than previous generations to reach their high-earning years. They also lag behind Gen X and Boomers when it comes to participating in employer-sponsored retirement plans. By age 35, only 37% of male Millennials were participating in such plans; compared to 50% for Gen Xers and 51% for late Boomers. Among 35-year-old Millennial women, 38% were in employer sponsored plans, compared with 49% for Gen Xer and 43% for late Boomers.
On the bright side, those Millennials who started participating in 401(k)s right after the Great Recession have seen their account balances balloon with the stock market and their own contributions. Fidelity Investments reported in May that the average account for Millennials who have been invested in one of its 401(k)s continuously since 2009 has grown from $7,000 to $129,800. Yeah, we know. Not that many Millennials have been in a 401(k) for 10 years—at age 25, less than 25% had employer provided plans. But still, it’s been a good decade in the market and the growth of automatic enrollment has raised participation among those workers who are offered a 401(k).
So Millennials, burdened by student debt and the Great Recession, are getting a late start on retirement savings, as well as marriage, home buying and kids. But as the CRR report points out, it’s a well-educated generation and “retirement is still a long way off”—meaning they’ve still got time to save. And despite their generational handicaps, Millennials are finding ways to make it work.