Expect widely held assumptions about retirement to change, according to new research from Transamerica Center for Retirement Studies.
In its 18th annual Transamerica Retirement Survey, TCRS examines three generations currently represented in the workforce: baby boomers, Generation X and millennials.
“The landscape is now changing so rapidly that it is clear that their retirement will be different from their parents’ generation and from each other’s as well,” according to TCRS.
The online survey was conducted between August 9 and Oct. 28 among a nationally representative sample of 6,372 workers age 18 or older, of which 2,593 were millennials, 1,586 were Gen Xers, 2,076 were baby boomers and 117 were born prior to 1946.
Millennial workers, which TCRS defines as those born between 1979 and 2000, are a “digital do-it-yourself generation of retirement savers,” according to TCRS.
The survey finds that most millennials (80%) are concerned that Social Security will not be there for them when they get ready to retire.
Unlike their parents’ generation, more than half expect their primary source of retirement income to be self-funded through retirement accounts (e.g., 401(k)s, 403(b)s, IRAs) or other savings and investments.
According to the survey, 71% are saving for retirement in a company-sponsored 401(k) or similar plan, and/or outside the workplace.
“They are getting an early and strong start with their retirement savings, but they need to learn more about investing,” according to TCRS. “And they are hungry for more information on how to achieve their retirement goals.”
The median age that millennials started saving for retirement was 24, according to the survey. However, the survey also finds that one in four say that they are “not sure” how their retirement savings are invested and 76% say they would like to receive more information and advice from their employers on how to achieve their retirement goals.
Generation X workers, which TCRS defines as those born from 1964 to 1978, are the first generation to have access to 401(k) plans for the majority of their working careers, according to TCRS.
“Generation X entered the workforce in the late 1980s just as 401(k) plans were making their first appearance and defined benefit plans were beginning to disappear,” according to TCRS.