According to a study released this week by Charles Schwab, millennials have started saving for retirement in their mid-20s. Despite their early saving efforts, "Millennials are expected to spend less time managing their finances and investments once in retirement compared to baby boomers."
The study further revealed that millennials will more likely use their savings to achieve dream lifestyles and pursue passions on their way to retirement and during. Schwab's new Retirement Reimagined Study projects four distinct retirement personas, provided to ThinkAdvisor, that millennials could fall into as many of them transition to retirement around 2050.
1. Practical Achievers
Practical Achievers will prioritize financial security more than their peers. They will continue to place importance on digital investments and currencies, extensively research their assets, remain up to date on macroeconomic trends, and invest evenly in stocks and cryptocurrencies. The Practical Achievers category comprises 12 percent to 22 percent of future retirees or 8.7 million-15.9 million millennials.
2. On-Trend Friends
On-Trend Friends comprises 3 percent to 23 percent of future retirees or 9.4 million-16.6 million millennials. This category is driven by purchasing power and "all things culturally relevant." The group will prioritize knowing the latest consumer trends and spend more time and money on shopping than their peers. Similar to Practical Achievers, they value financial security as a way to maintain their lifestyles.
3. Relaxed Minimalists
Relaxed Minimalists will value deep relationships. They will focus less on finances and devote more time to hobbies, relaxation, and personal time. This group comprises 31 percent to 41 percent of future retirees or 22.4 million-29.6 million millennials.
4. High-Tech Jetsetters
Comprising 24 percent to 34 percent of future retirees or 17.3 million-24.5 million millennials, this group is nomadic and fast-paced. High-Tech Jetsetters will prioritize travel, trusting technology to keep up with family and friends.
Financial Advisor Transitions consults advisors nationwide to explore employment transition options and to preserve and protect their practice in any transition that they make.
