Most millennials are saving for retirement, prefer human advice: study

Even though millennials sometimes get a bad rap for being frivolous, a new study from New Jersey-based fintech firm LendEDU found that more than half are saving for retirement — and with the time value of money on their side, they could be better prepared than some had previously thought.

The study of U.S. millennials found that 58% are actively saving for retirement. The average amount saved so far is $26,475, but varies widely by age (millennials under 27 have $7,796 saved, those 28-32 have $21,375 saved, and those over 33 have an average of $39,787).

The majority of millennial respondents also said they see the value of advice: 65% would prefer a human advisor over a roboadvisor, and only 16% would opt outright for the robo. Of the one-fifth of millennials who have advisors, 89% think they’re worth the cost, the survey found.

Income was significantly correlated to retirement savings, as only 34% of millennials earning $49,000 a year or less reported actively contributing to investment accounts for retirement, compared to 77% of those earning $100,000 or more annually. Interestingly, the survey found that all income groups had saved roughly the same amount ($26,450 in the lowest income group and $26,638 in the highest).

The survey found that millennials were most invested in three sectors: finance, tech and healthcare.

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.