Supported by GEICO.
It’s difficult to imagine what the world will look like in 40 years. The globe has spent the last 18 months in survival mode; people have been steeling themselves against a world-altering pandemic, a slew of cascading natural disasters, and a pile of unanswered questions about disinformation, radicalization, and the nature of equitable, full-time employment in general.
Personally, I emerged out of 2021 with the sudden realization that I am now 30, without ever considering the implications of that threshold while I bided time in lockdown. This is where millennials stand at the cusp of a new decade and all of its incredible, unprecedented trauma—not quite young and not quite old, reckoning with a petrifying anxiety on the horizon. What am I going to do about retirement? Am I putting enough away? Am I doomed? Am I on the right track? How do I even know for sure? Trust me when I say you're not alone if you too are turning over those ambiguities in your head. It's practically a generational rallying cry.
By every conceivable metric, we are in the midst of a retirement anxiety epidemic among millennials. A University of Missouri study from 2017 found a mind-boggling 63 percent of workers in their 20s and early 30s didn't possess a retirement account. A similar number believe they will be working, at least partly, through their golden years.
It's a number that gets even worse when filtered for race and privilege—83 percent of Latinos and 70 percent of Blacks don't have any money put away, per the National Institute on Retirement Security. The primary reason? Bad wages, or an inability to participate in an employer's retirement plan. This is in line with so many other sources of dread within the age bracket. To establish your retirement potential, you must also consider the declining homeownership rates, the vulturous presence of student debt, and the enveloping gig economy realities that don't offer any pensions or benefits. Millennials are significantly behind in the wealth gap compared to previous generations. Simply put, oftentimes it feels like there isn't enough money to go around.
"It doesn't feel like that wealth is trickling down to us," says Tripp Kerr, a 26-year old who has a job training call center agents in Denver who says he isn't confident he'll be able to retire before 70. "The whole idea of going to college, getting a good job, and getting a mortgage feels like a pipe dream. I think everyone in my generation feels like they got screwed."
And yet, despite all of that turbulence, in 2021 it feels like there are more financial advisors promising a one-size-fits-all savings solution crowding our Instagram feeds than ever before. They are ubiquitous. Broke Millennial reads the title of one self-help guide published in 2017. The Millennial Money Fix counters another title, which features an image of Benjamin Franklin in earbuds on the cover. The thesis is clear across the board; that there exists a crazy trick in the economy to balm all of our debt and insecurities for good. One of the most frequently repeated axioms in orthodox retirement philosophy is the idea that anyone ought to have a year's worth of their salary saved by the time they turn 30. If you haven't reached that threshold—if you are one of the many people who just started considering their long-term money supply in their late 20s—those truisms are disempowering. Why even start if I'm already so far behind?
"I think all these stupid ideas do is make the people who probably should think about this stuff—the people with no generational wealth, the new upwardly mobile folks—feel like everything is so unobtainable," says Clara Lilley, a 27-year old in London who works on the digital team of an NGO. "Like that it’s better just to spend it all now rather than plan for the future."
This is one of the recurring refrains when you ask young people about their retirement plans. There are so many competing viewpoints, so many differing ideas about the right way to plan for the future, that a strange paralysis eventually sets in. Arielle Gordon, another 26-year old who works as both a coder and a freelance writer who is similarly stressed about retirement, notes the propensity of her peers to derive financial knowledge from "long LinkedIn posts" penned by quasi capital influencers. That's not a healthy way to pilot your savings to 65, but Gordon believes the institutions aren't yet equipped to handle the new realities and priorities of the emergent professional class.
"It feels like my brain is a dixie cup and the information is a firehose," she says. "Should I be choosing a high-deductible health insurance plan instead of having coverage? That seems a little scary. As a young woman, when I talk to financial advisers I get the sense that they typically work with older men who are worried about their kids' college funds. It feels very prescribed that specific goals of home ownership, and child bearing, and joint-checking accounts. I often feel like I get laughed off, because I'm not at a stage that they have plans for."
Denny Artache, a financial advisor in Florida, believes there is no need to despair when there's such a simple solution available to pierce through all of the noise. He compares the retirement dialogue among millennials to the diet and exercise industry. Every personal trainer has their own system—equipped with their own caloric benchmarks and advice on macros—that often contradict one another. Far too often clients jump from plan to plan, as the proclivities of the culture changes shape. (Three sets of 10? What about 10 sets of three?)
Artache understands all of the associated stress millennials have with retirement, but says the best salve is to simply start saving, in any way you can. There is magic in proving to yourself you are capable of putting money away. Artache says young people will be surprised how quickly it starts adding up.
"Put $50 a week away. Or $100 a week away. My approach is to forget the numbers completely," he says. "Just start the habit of putting money away. You can only do what you can do. That is how you deal with the anxiety."
Artache is correct. There is a therapeutic dignity in simply doing the work, and it is far better to save money than to talk endlessly about the act of saving money. But will that same philosophy bear the same gifts it blessed our forefathers throughout the 2020s and beyond? When the financial health of all millennials is lagging behind the mean, is the American ideal still alive? That is a question that only the future can answer.
This article is supported by GEICO.