Friday, January 26, 2018

New paper: “Will Millennials Be Ready for Retirement?”

“Will Millennials Be Ready for Retirement?”

By Alicia H. Munnell and Wenliang Hou

The brief’s key findings are:

  • Millennials – despite high education levels – are behind previous cohorts on many indicators that help boost retirement preparedness.
  • Having entered the labor market in tough times, Millennials have lower wages and fewer fringe benefits than Gen-Xers and late Baby Boomers did as young adults.
  • This difficult start, combined with high levels of student debt, has delayed them from getting married and buying a home. 
  • Not surprisingly, then, Millennials have less wealth than previous cohorts, even though they will need more due to longer lifespans and reduced Social Security.
  • The one piece of good news is that retirement is still a long way off, so they have time to get back on track.

This brief is available here.

1 comment:

WilliamLarsen said...

No mention of the lower payroll taxes prior to 1983 which gives a boost to saving, paying down debt and building wealth.

A higher percentage of millennials went to college => higher demand => higher student loan debt, lower savings due to not working and the fact that only about 22% of all positions require a degree adds to lower wealth.

The only thing I see questionable is the life span. These numbers seem to contradict the SSA period cohort life tables.