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Financial goals and milestones of Millennials not backed by action, new study finds

Brian Anderson

PARK RIDGE, Ill. — While Millennials (adults ages 18-34) want to achieve many of the same traditional life milestones as their older counterparts, they are waiting later to start saving and instead focusing on other financial priorities, shows a study commissioned by the Million Dollar Round Table (MDRT), an association of top financial professionals, and conducted online by Harris Poll in April among more than 2,000 U.S. adults ages 18 and older.

Understanding the Millennial mindset and knowing their financial planning triggers can help financial professionals engage earlier and more successfully to help them achieve their long-term goals.

Millennials on retirement

Despite the fact that the average age Millennials say they expect to retire at is age 62 — which is younger than the expectations of older generations (ages 45-54 at 66 years old; ages 55-64 at 65 years old; and ages 65+ at 73 years old) — a mere 22% of Millennials say they are currently saving for retirement.

When it comes to financial planning (see infographic below), Millennials are more focused on other priorities such as travel, pursuing higher education or buying/renovating a home. One of the arguably most important priorities falls by the wayside with 91% of Millennials stating they do not even have a financial plan for retirement. When Millennials were asked about their priorities in the next five years:

• 30% say getting married/engaged

• 33% say paying off student loans

• 41% percent say having a financial plan

• 45% say advancing in their career

• 48% say buying/renovating a home (only 33% are currently saving for this)
“Millennial expectations to retire at a younger age than their predecessors does not match with their lack of financial action. While most say it’s a priority to focus on planning, less than 10% have actually started doing so,” said MDRT President, Brian D. Heckert, CLU, ChFC. “What they may not realize is that having a plan now can give them greater retirement savings and increased financial security during those golden years.”

Prioritizing a financial plan

Roughly three-quarters of Millennials (76%) believe they need a financial plan to achieve traditional milestones and are more likely than their older counterparts (60% of those ages 35+) to say that developing one is a priority over the next five years, but they need help to get there. In terms of achieving milestones, Millennials are:

• More likely to worry about never achieving traditional milestones (53% vs. 31% of those ages 45+)

• Delaying financial planning because they don’t have enough money to cover minimum expenses (38%) or are unsure where to start (27%)

“Our job as financial professionals is to find this disconnect in the younger generation’s mind and educate them on the realization that a little saving goes a long way,” Heckert said. “It’s never too early to start planning for your future.”

Because of Millennials’ desires to prepare for milestones with financial planning, and subsequent reasons for delaying, the study found great disparities in timing for traditional milestones among the generations.

“I’ve worked with Millennials who need help understanding how saving when you’re young can pay dividends over time, even with small amounts of money,” said Brenton Harrison, two-year MDRT member and financial advisor for Henderson Financial Group. “Until you educate them, they will continue to believe that they don’t have enough to make a difference, and they’ll divert that money to other priorities.”

Survey Methodology:  The study was conducted online from April 7-11, 2016 by Harris Poll on behalf of MDRT among 2,126 U.S. adults ages 18+ (among which 511 are ages 18–34, 306 are ages 35–44, 373 are ages 45–54, 494 are ages 55–64 and 442 are age 65+). This online survey is not based on a probability sample and therefore no estimate of theoretical sampling error can be calculated. For complete survey methodology, including weighting variables, please contact Tori Unger, G&S Business Communications.

About MDRT:  Founded in 1927, the Million Dollar Round Table (MDRT), The Premier Association of Financial Professionals®, is a global, independent association of more than 43,000 of the world’s leading life insurance and financial services professionals from more than 500 companies in 67 countries. MDRT members demonstrate exceptional professional knowledge, strict ethical conduct and outstanding client service. MDRT membership is recognized internationally as the standard of excellence in the life insurance and financial services business. For more information, please visitmdrt.org.



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