19 May 2023

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Millennials, boomers and retirement savings

Luigi Campopiano

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According to a survey conducted by Charles Schwab, the millennial generation has started saving for retirement about 10 years earlier than boomers. The investment firm associates this goal with a series of different and unique considerations.

Millennials view retirement less as a savings target or a date but more as a state of mind or a lifestyle. Younger investors are making their first-ever investments in recent years and are committing to retirement and related planning, while also pooling other resources that will help them make their retirement uniquely theirs. Compared to boomers, millennials consider cryptocurrencies an alternative to consider even during retirement.

Between now and 2050, when most millennials will start retiring, four different profiles will emerge:

• The most practical millennials, who will prioritize financial security, will be the least nurtured group. They will continue to place importance on digital investments and currencies, thoroughly researching their assets, staying abreast of macroeconomic trends and investing wisely uniformly in stocks and cryptocurrencies.
• A slightly higher percentage will be “On-trend friends,” who will prioritize keeping abreast of the latest consumer trends, spend more time and money shopping than their peers, and value financial security and a healthy spending budget.
• The largest pool will be that of "relaxed minimalists,” who will prioritize the simple pleasures of their daily routine and value deep relationships more than other people. They will focus less on finances and spend more time on hobbies, relaxation and leisure.
• High-tech jet setters will be more travel-focused than their peers, relying on technology to keep up with friends and family as they move into retirement.

Everyone will have a different vision of their ideal retirement, but the key for all is to start saving and investing early. 

If you dream of constant travel, you need a specific line item in your retirement plan to ensure you have the funds to make it happen. If you want to maintain exposure to higher-risk assets like digital currencies in your retirement portfolio, balance that with more traditional investments that can provide a reliable source of income when you don't have a paycheck. And finally, you prepare for retirement to enjoy it, but it's important to have a solid income and distribution strategy so you don't risk running out of money in retirement.