A Snapshot of Millennial Retirement
What the golden years will look like for today’s young people
If you’re in your twenties and haven’t started thinking about retirement, well, it’s probably time to start. Yes, it’s still very far away, and yes, it’s easy to imagine that by the time the millennial generation hits retirement age, we’ll all be living in some sci-fi realm where health care is less complicated and robots take care of the elderly. But in the real world, enjoying your golden years requires careful planning long before you reach them.
And that planning takes on new urgency when you consider the fact that retirement a half-century from now will almost certainly look different from retirement today. Life expectancy is getting longer, climate change is threatening many popular retirement destinations, people are less likely to get married or have kids, and more people are working past the age of 65 just to get by. Here are the major things you should consider as you begin to outline your road map to retirement.
Social Security will still exist, but it won’t be enough
It’s estimated that our Social Security trust will be gone by 2034. To put an alarming number in context, that doesn’t mean there won’t be any money available at all by the time millennials are eligible to receive it. It simply means there won’t be a surplus of Social Security funds to fall back on. A majority of current Social Security payouts actually comes from taxpayers, and that will remain true in the future.
But as finance writer Kristin Wong, author of the book Get Money, explains, future generations are likely to get a lot less money in their payouts if things stay on the current course. That means Social Security definitely won’t be enough for you to live on and may not even be enough to be a major factor in your budget planning. Wong suggests you prepare for the worst and do whatever you can to avoid depending on Social Security. “Save like your retirement depends on it,” she says. “Because it kind of does.”