Merrill Edge Reveals How Millennials Think About Financial Planning
Mass affluent millennials are more likely than older generations to take matters into their own hands when it comes to financial planning, according to a recent Merrill Edge report.
Sixty-six percent of millennials chose their savings accounts as the top source of funds they think they can rely on in 20 years, according to the report. By contrast, 71% of Gen Xers picked 401(k) accounts as their main source of funds, while 54% of Baby Boomers picked pensions and 50% of them chose Social Security, according to Merrill Edge, which surveyed 1,000 people aged 18 to 34 with $50,000 to $250,000 in investable assets, or those aged 18 to 34 with $20,000 to $50,000 in investable assets and a minimum $50,000 annual income, or those aged 35 and over with $50,000 to $250,000 in investable assets. Many millennials think they’re more financially conservative than older generations, meanwhile: 46% say they’re more conservative than their parents and 35% believe they’re more conservative than their grandparents, Merrill Edge found.
Driven by the lessons of the Great Recession a decade ago, according to Merrill Edge, millennials are willing to make major sacrifices to ensure they have enough money over the long term. Fifty-four percent are willing to cut back on going out, 42% would go without a vacation for a year, 36% would delay buying a home and 33% would delay getting married and having children, Merrill Edge found.
The recession continues playing an important part in millennials’ decision-making: 78% say the recession influences their real estate purchases, 58% say it affects their decision about higher education and 53% say it’s a consideration when it comes to having children, according to the report. Moreover, 80% of millennials think they’ll see another recession during their lifetime while three in 10 believe it’s coming within five years, Merrill Edge found.
Overall, meanwhile, Americans are optimistic about their financial future. A full 96% believe success is attainable and 52% think they’re already there while 44% think they will be one day, according to the survey.