Why Millennials are More Stressed About Retirement

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Millennials are stressed about their retirement, and the level of stress grows every day. Not only are their expenses consistently rising just like everyone else’s, but they are part of a working generation that is seeing incredible degrees of wage stagnation. Data from the US Bureau of Labor Statistics show that average hourly wages, when adjusted for inflation, have barely budged in decades.

There are other factors that significantly elevate the level of stress that millennials feel surrounding their potential retirement as well. Many are experiencing the after-effects of the Covid pandemic, and have nearly or completely wiped out any savings they had. Some are even stressing about their parents’ retirement as well.

The Money Worries Never Stop

The consistent push to attend college and get a degree has left countless millennials saddled with enormous levels of student loan debt that can be difficult to leverage in the current job market. Many of these loans were through federal loan programs, but the monthly payments can still be devastating in some cases. Even with access to some of the best debt consolidation options, some millennials still struggle with being able to put anything aside for debt repayment.

This leads millennials to have less overall disposable income than any other generation, which is then taken up by the rising cost of living. The primary concerns most millennials face financially, include:

  • Economic growth
  • Unemployment
  • Being able to afford to care for their health.

The result of this is a near-constant state of monetary anxiety that millions of members of a generation live with. This stress and worry have forced millennials to focus on the near-term effects of their money because their experience tells them it won’t be around in the long term due to bills, expenses, emergencies, or inflationary decay.

Covid Hasn’t Helped

While many millennials find that normal life is challenging enough, the recent pandemic has created an entirely new set of stressors. Millions of millennial workers found themselves unable to work during the early days of the pandemic, and even with stimulus money, many people still found themselves underwater.

Any savings that existed would have been the first to go, and after that, many people turned to credit cards. Even though temporary and burdened with dangerous interest, these were a lifesaver for many. In some cases, those who became desperate and had retirement funds, such as a company 401(k), may have taken early disbursements or even hardship withdrawals.

Retirement Is Expensive

What it really comes down to is that for most millennials, “retirement” really means “saving for retirement,” which is something that so many don’t have the option to even do in many cases. Even those that do save may not be saving nearly enough to make the retirement they want a possibility.

Recent research from the National Institute on Retirement Security shows that up to 95% of millennials aren’t saving what they need to. The report shows that not only are depressed wages and lack of eligibility hampering participation but that only about one-third of employees even participate in retirement programs when they are offered.

The Final Word

With so many individual stressors and contributing factors, there are plenty of reasons for millennials to be anxious about retirement. While there are side-hustles and ways to save a little extra here and there, for many it seems like a nearly-impossible uphill journey. Even with so many challenges on the path to retirement, millennials are resilient and will find a way that works for them on an individual level.



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