Millenials expect to rely on work income during retirement

by Grace

Personal savings and income from work will become increasingly important to future retirees.

Working in retirement is likely to become even more commonplace as Generation Xers and Millennials eventually head toward their retirement years. While many of today’s retirees say they can count on Social Security and employer pensions to fund most of their retirement, future generations are far more likely to say they will need to rely primarily on personal savings and income from working during retirement (FIG 8).





Although I was initially surprised that 12% of Gen Xers and Millenials still expect pensions to fund their retirement, I realized these might represent the views of government employees, one of the few groups still covered by traditional pension plans.

And those who expect personal savings to cover retirement expenses need to start saving more.  The latest alarming news on this topic is that “middle-class people in the USA have a median of $20,000 saved for retirement, far short of the $250,000 they think they’ll need during that time of their lives”.


Work in Retirement: Myths and Motivations, Merrill Lynch with Age Wave, June 2014.

2 Comments to “Millenials expect to rely on work income during retirement”

  1. I looked at the report you cited, and it is not clear what those pie charts mean. Are they the percent of people who expect X to be their primary source of retirement income, or are they the percent of retirement income people expect to get from X? I certainly have 4 different retirement income streams planned: university pension, social security, investment income, and part time work. I’ve not done calculations lately to estimate how much of my income will come from each—probably pension and investment income first, with social security deferred until I turn 70. Part time work will probably make only a minor part of my retirement income, because I’ve been very diligent about saving for retirement. My work will most likely be a hobby business.


  2. It’s not completely clear, but I took it to mean X will be their primary source of retirement income. Expecting that working income will make up a primary source of retirement income is unrealistic. SAVE MORE, PEOPLE! Not sure how it’ll turn out, but there’s bound to be trouble ahead. Oh, I shouldn’t be so pessimistic because the future is hard to predict.


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