If millennials live up to their ambitions, the future of retirement could be younger, earlier and thus longer than ever before.
In the most recent Future of Retirement report released this spring by London-based HSBC, U.S. millennials, born between 1980 and 1997, reported an average planned retirement age of 58 years old.
“While millennials are broadly aware of the economic and demographic challenges they face, they do not appear to have grasped the full implications for their retirement,” said Charlie Nunn, HSBC group head of wealth management, in a released comment.
Nevertheless, HSBC’s report also suggests that millennials could have what it takes to meet their lofty goals. Most millennial respondents, 80 percent, say that they have already started saving for retirement, and 75 percent say that they will cut expenses to help save more for retirement.
Naturally, that raises questions about how millennials are saving. While other surveys reveal that many younger workers keep high allocations to fixed-income investments and cash, nearly half of the millennial respondents in the study indicated that they were willing to take on more risk. Millennials, according to HSBC, are willing to take on more risk than older investors, which comes as no surprise.
Millennials are also willing to learn more about personal finance and investing, with almost two-thirds of the respondents, or 63 percent, actively seeking information to guide financial decisions. Older respondents were significantly less active in seeking out financial knowledge themselves, according to HSBC.
Globally, only 10 percent of millennials expect to continue working past 65, but 59 percent believe that they will live much longer than previous generations and will have to plan to support themselves over a longer retirement.
For its study, HSBC sponsored surveys of 18,414 people aged 21 and older from 16 different countries and territories between November 2016 and January 2017.