If high-net-worth Americans plan to retire at an average age of 56 and more than half plan to keep working in retirement, as a recent study by BMO Private Bank found, what exactly does retirement mean to today’s affluent clients?
Jack Ablin, executive vice president and chief investment officer for BMO, said the influence of millennials can’t be ignored.
“I would say the [average retirement] age was skewed a little low because I think young people, most notably the millennials, redefine how they view work in retirement,” he told our sister site, ThinkAdvisor.
Millennials value their time and experiences more than the stuff they accumulate, Ablin said. “They want to do their work, accumulate a certain amount of money and then do what they really want to do. The priorities among millennials are different from those of, say, baby boomers.”
Engaging with those younger investors can be difficult, Ablin said, and some high-profile companies have “misread millennials and have gotten their business strategies wrong.”
He said that at BMO Private Bank, “We’re spending a lot of time trying to address the needs of young people. It’s clear it’s going to be critical to our long-term success.”
The study found that while the average age at which HNW investors expect to retire is 56, 20 percent plan to retire even earlier — before age 40.