Surprisingly, 15% of millennials cited winning the lottery as part of their retirement strategy.

Will millennials be able to retire before age 80?

A new report from the Insured Retirement Institute (IRI) and the Center for Generational Kinetics features some good-news, bad-news results when it comes to this oft-talked about generation and the state of their retirement.

“The research found that millennials are not nearly as prepared as they need to be, with some notable exceptions, and the findings show that if we don’t act now to prepare millennials for retirement, they may reach retirement age and have no option but to keep working well into their 80s,” the report, released on Monday morning, states.

The study, which was conducted in August, is based on a survey of 1,110 Americans age 18 to 65, with a 10% oversample of millennials, those aged 20 to 37.

The study does, however, debunk several of the common myths that millennials — at 80 million members, the largest generation — are not saving for retirement.

According to the study, 68% of millennials are currently saving and investing for retirement.

Jason Dorsey, chief strategy officer and lead millennials researcher at the Center for Generational Kinetics, called this finding “shocking.”

“The story out there is that millennials aren’t thinking about retirement at the very least,” he said during a conference call presenting the research results. Adding, “To discover that 68% of millennials – or two-thirds – are actively right now saving and investing was really kind of a shocking stat.”

Dorsey expects that some of this may be helped by the auto-enrollment features utilized by many 401(k) plans – of which 48% of millennials report having a 401(k), according to the study.

Dorsey thinks the percentage of millennials in a 401(k) is “much higher than people would have guessed.”

“Part of what we think is happening there, we don’t have the actual data to back it up, but our suspicion is as employees have been auto-enrolled in 401k plans … we do think that is what’s leading that number being so high,” Dorsey said during the conference call.

While the study debunks the myth that millennials are not thinking about retirement, the study confirms that millennials are not actively planning for retirement.

Only 29% of the millennials surveyed describe themselves as actively preparing for retirement, according to the study.

“It’s pretty apparent that millennials are not prepared,” Dorsey said during a conference call. “They don’t necessarily know what they’re supposed to be doing, and this is not a problem about millennials in isolation that only affects them. Everyone one of us will be affected in some way, if millennials are not able to better understand and be careful and really take action now to better solidify their future.” Digging deeper, the study found that 60% of millennials think it is harder to plan for retirement than to stick with a diet and exercise plan.

Interestingly, when it comes to what millennials consider to be part of their retirement strategy, 15% of millennials list winning the lottery as part of their retirement strategy, which Cathy Weatherford, president and CEO of IRI, finds concerning.

“When I hear 15% of millennials saying they’re winning lottery would be their strategy to pay for their retirement I think I’m hearing a bunch of young people who maybe are not thinking about retirement as seriously as a part of their future,” Weatherford said during a conference call. “Maybe it’s because it’s so far out. Do you think it’s also the disheartened state [millennials are] in as a result of the debt and the student loan and trying to get their careers on track? So, the idea of a retirement nest egg or building out any kind of strategy is just not real.”

In addition, 11% expect to be gifted money for retirement.

Dorsey, who is a millennial himself, finds this retirement “strategy” of his generation to be troubling.

“If this is a real strategy, we’re all in trouble,” he said. Adding, “There will be a substantial transfer of wealth potentially to millennials, whether that’s from their parents or grandparents. But, what we are seeing is that baby boomers and other generations live longer and spend down their retirement. There is a bigger conversation where the millennials are going to have to take care of their parents and their parents may end up outspending their retirement, which would substantially effect whether or not you’re actually going to get some big financial gift at the end.”

Another potentially troubling retirement strategy among millennials is that 77% of the millennials surveyed list debt reduction as their “No. 1 retirement step.”

“This is important because obviously more millennials have more debt at this age than any previous generation largely due to the cost of college, university. The knee-jerk reaction is to pay off debt,” Dorsey said during the conference call. “The challenge with that is as an actual retirement strategy by itself is not the only one, and the idea that you can pay off debt and be able to retire shows that there’s a lot more education [millennials] need to have.”

As the report states, the combination of not saving, taking actions (like paying off debt) that do not accumulate resources for income in retirement, and that more than one in 10 expect to be given money for retirement shows that “this generation is largely not on track to attain financial security in retirement.”

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