Millennials, the youngest generation in the workforce today, are highly motivated to save for retirement and would plan ahead if they knew more about retirement benefit options from their employers, according to a new study released today by Prudential Retirement, a business unit of Prudential Financial, Inc. (NYSE:PRU).
More than 32 million members of the Millennial generation are an active part of the workplace population in America. Prudential’s 2012 study “ Younger Workers and Retirement,” revealed that these consumers, born in or after 1991, recognize that contributing to their retirement is a must, even in an economic recession. In fact, 83 percent say that seeing what can happen to people who don’t save enough for retirement makes them want to save more.
“Our research dispels the myth that Millennial workers don’t care about preparing for retirement,” said George Castineiras, senior vice president of Total Retirement Solutions. “Saving for retirement ranks highly in this generation’s list of financial priorities and we are encouraged that these younger workers are taking responsibility for their future.”
The study presented Millennial workers with a “Retirement 101” quiz and also offered them the opportunity to grade their workplace retirement plan’s education, tools and information. The quiz challenged survey respondents with a real-life test asking them to allocate ten to 20 percent of their monthly income to various discretionary areas, after paying all necessary expenses, such as housing, utilities, food and transportation. The results demonstrate that Millennial workers prioritize saving for retirement ahead of leisure spending, saving for vacation or a house. At the same time, however, the study reveals clear gaps in Millennial workers’ overall knowledge about retirement planning, as well as deficiencies in tools available to them to help them with it.The “Younger Workers and Retirement” study also discovered that, although Millennial workers understand retirement planning as a concept, they also perceive their employer-sponsored plans as complex and overwhelming. The Prudential survey suggests more rewarding experiences, as well as interactive, retirement-focused educational solutions, would motivate Millennial workers to contribute more to their retirement savings.