But it’s not all good news. The increased savings may be because millennials have no expectations of receiving employer-sponsored retirement plans upon retirement. In 1981, 84% of full-time workers in large corporations participated in a pension plan; By 2020, that percentage has fallen to just 28%, according to the Bureau of Labor Statistics.
“A lot of Boomers felt their retirement was taken care of for them,” said Angela Montez, a special counsel at the law firm Eversheds Sutherland, where she focuses on retirement policy and investment.
Montez said lifestyle goals also play a role in increasing savings. Millennials are more mobile than previous generations, so investing in a home isn’t necessarily a priority, and their money tends to be allocated to 401(k) plans.
About three-quarters of Boomers and Gen Xers expect to own a home in retirement, while less than half of Millennials own. Schwab’s study found that more than 60% of millennials will prioritize travel when they retire.
Millennials also said they will devote less time to managing their finances and investments once they retire, the study found, because they aren’t as focused on continuing to accumulate wealth later in life as Gen Xers and Boomers.
“Millennials don’t view retirement as a target savings number and time, but rather more of a target state of mind or lifestyle,” said Jonathan Craig, Head of Investor Services and Marketing at Charles Schwab.
There is one thing millennials are focusing on: cryptocurrency. Schwab found that about 25% of millennials plan to invest in cryptocurrency, compared to about 5% of boomers.
Advisers remain skeptical about such changes.
said Rob Williams, managing director of financial planning, retirement income and wealth management at Schwab. “Currently crypto is not considered ineligible to have it.”