When it comes to money, the generation that everyone loves to label is proving increasingly resistant to stereotypes.
Are the majority of Millennials (also known as Generation Y) already diligently socking away money in their retirement accounts? Or are they too overwhelmed by the $1.2 trillion student loan burden plaguing the U.S. today?
Well, it depends whom you ask.
According to a recent survey by the Transamerica Center for Retirement Studies, 70% of Millennials are saving money for retirement, either through employer-sponsored plans or outside of work. The survey found Millennials start saving at a median age of 22, significantly earlier than Baby Boomers, who didn’t begin saving until about age 35.
But research findings from Wells Fargo paint a slightly different picture. According to that data, 42% of Millennials feel overwhelmed with debt—double the amount of Boomers who feel the same way. More than half of Millennial respondents said they haven’t even started saving for retirement, and 81% of those who aren’t saving said they “agree” or “strongly agree” that they need to get rid of their debt first.
Because everyone’s financial situation is different, there are no easy answers to questions about how to prioritize saving for retirement when you’re still drowning in debt. But a recent analysis by The New York Times suggests that it’s possible—even essential—to simultaneously pay off student loans and put money into a retirement account.
Likewise, at LearnVest, we advise those stuck with student (and other types of) loans to think about paying off their debt and saving for their future retirement as equally important—if challenging—goals.