Millennials Have Been Told To Work For Longer & They're Not Happy About It

Another week, another piece of bleak economic journalism telling millennials they're doomed to a future of living hand to mouth as a result of factors beyond their control – and this time they're not buying it.
An article published on the US political website Politico says the current generation of 25-to-35-year-olds should be "willing and able to work longer than their parents and grandparents did" if they want to enjoy the same economic security in retirement.
The article, by Alicia Munnell, director of the Centre for Retirement Research at Boston College in the US, runs through the myriad economic circumstances negatively impacting on millennials' finances, which will continue to blight their lives well into the future, including affecting their level of financial security in old age.
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"Concern about the financial health of America’s younger generations is growing—especially millennials, a demographic boom that came of age in an environment of unstable work and record levels of student debt," Munnell writes. "Experts worry that millennials are falling so far behind previous generations that their retirement may be at risk."
According to her own research, "those concerns are real, and millennials really are building wealth more slowly than the other working generations". But – she adds in the article, as if to throw young people a bone – "they are not insurmountable—as long as millennials are willing and able to work longer than their parents and grandparents did."
Unsurprisingly, people on Twitter weren't buying the analysis that the only way to improve millennials' financial health is by compelling them to work for longer than their parents and grandparents did.
Many people suggested some alternative ways to solve the crisis for millennials – some more radical than others.
The reason for millennials' poor retirement prospects, Munnell argues, is threefold: first, their "limited access to retirement plans at work", meaning they'll struggle to save for retirement as research shows people find it difficult to save on their own; second, the fact they're less likely to be homeowners, "and home equity is a valuable retirement asset"; and third, student debt means it's more difficult for them to put money into their retirement plans.
"The wealth-to-income ratio for millennials is not only below that for Gen Xers and late Baby Boomers now, it is also projected to remain lower through their lifespans," she writes, adding that "millennials’ lack of wealth in their 30s relative to earlier cohorts should be a source of great concern, given that they will live longer than previous cohorts and will face higher health care costs." Plus, they'll also likely have to wait longer to receive state social security.
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The situation for millennials in the UK is similar. The national state pension age is set to rise to 68, from the current 65 for men and 60 for women, by 2037 and there's a high likelihood that it could rise further in the future. Not only this, but a worrying proportion of British millennials currently have no pension provision in place.
According to a survey by YouGov last year, 44% of 18-34-year-olds have no pension provision whatsoever, compared to around a fifth of 35-54s (22%) and over-55s (20%). Millennials also know the least about pensions, with over a quarter (27%) saying they don't understand them in general, and even 14% of those with a pension not knowing what type it is.
With an ageing population putting a strain on the state pension (more older people means the government needs to pay out more), and many young people unable to pay into their own pensions, retirement doesn't look rosy for millennials.
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