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The Numbers Are in On Millennial RetirementHow To Combat This

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Mar. 12 2019, Updated 2:55 a.m. ET

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Millennial brokenness has been the subject of much discussion in recent years. A new study by Alicia H. Munnell, director of the Centre for Retirement Research at Boston College, brakes down the prospects for millennial retirement, and how the most screwed over generation can best prepare for it.

First of all, millennials are doing the most but getting the least out of it. The study found that a higher percentage of millennials have degrees than Gen-Xers and late baby boomers. Despite this millennials are lagging in almost every economic dimension. The fact that millennials are more educated than previous generations is paradoxically one of their obstacles for retirement.

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Munnell listed Student loan debt as one of the three things that will hold millennials back from retiring. American millennials take out loans for extortionate tuition fees and pay them back at extortionate interest rates. The total of American student loan debt recently hit $1.5 trillion, with women holding most of it. The burden of having to pay this back predictably means that this generation has less money to put aside for retirement.

Another obstacle is that there is less access to work-based retirement plans. This is significant because saving on one’s own is difficult. It is especially difficult for millennials because so much of what they earn goes to paying student loans. Work-based retirement plans are exactly the type of help that this generation needed.

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The third strike against millennial retirement is that because of the struggle to save, they are unable to buy homes which are an equitable retirement asset.

How To Combat This

The study did show that it is possible to improve your retirement prospects; by working longer. Although it’s tough to call it good news, Munell said that working longer is a powerful lever. This is because social security benefits claimed at 70 are at least 76% higher than those claimed at 62. The extra years spent working mean that 401(K) assets can increase. It also means they have less time to cover. Essentially the conclusion to the study is that most millennials will eventually be fine if they work till the age of 70.

So whilst the road ahead is tough for millennials, it is still possible for them to retire, providing they work hard until 70.  And also providing that there aren’t too many cuts to Social Security.

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