Are Millennials Saving Enough for Retirement?
Another millennial myth may be biting the dust. Apparently, millennials have better retirement saving habits than baby boomers.
Millennials save 8 percent of their paycheck for retirement, according to a recent survey from T. Rowe Price. Baby boomers are just slightly ahead at 9 percent.
The only reason millennials aren't saving even more is that they have college debt to pay off and don't earn much money yet, according to Anne Coveney, senior manager of retirement thought leadership at T. Rowe Price. The median personal income of millennials is just $57,000.
"Their circumstances may be somewhat driving their behaviors," says Coveney. "When they have the means to do the right thing, it appears that they often do."
Indeed, millennials track expenses more carefully than boomers (75 percent vs. 64 percent). And 67 percent of millennials stick to a budget. That's better than the 55 percent of boomers. Meanwhile, 88 percent of millennials say they are pretty good at living within their means.
To be fair, the boomers are saving a higher percentage of their salary for retirement than millennials, but twice as many millennials have upped their retirement savings in the last 12 months, T. Rowe Price says.
