One Thing That Worries Millennials, But We're Afraid to Talk About


Millennials are not saving for retirement. A recent survey conducted by Thestreet and GfK Roper Public Affairs & Corporate Communications found that "nearly 70% of Millennials have not begun saving for retirement." Though shocking, this is far from unbelievable. Most of the young are more concerned with paying down their staggering student loan debt, finding good employment and are not stocking away for their golden years.

Nevertheless, worries about the sustainability of our retirement system still plague us. The same survey found that Millennials view our Social Security as a system with “systematic sustainability issues for the long term” but still factor it into their retirement planning. (Although another 2013 study by National Academy of Social Insurance found that concerns dropped significantly when people understood all it took to ensure Social Security far into the future was for everyone to pay the same rate.) This finding points to Millennials’ confusion about how to plan for retirement at a time when our country is openly weighing the benefits of cutting programs for an expedient way out of our constant budgetary crisis

Unfortunately, because of misinformation, Millennials don’t know that Social Security is the most successful retirement program in history. It is entirely self-financed and does not contribute a penny to the national debt. Cutting it would be disastrous. It is true that our Social Security system has a modest projected shortfall, but Senator Tom Harkin (D-Iowa) and Senator Mark Begich (D-Ala.) have introduced similar bills in Congress aimed at expanding benefits and addressing the shortfall.

Senators Harkin and Begich, along with around 75% of all Americans, understand that Social Security has been the rock people can count on when the rest of our retirement system is cracking and crumbling around us. Increasing Social Security benefits is only the first step toward building a more functional retirement system.

Today’s retirement system

In the past, our vehicles for retirement were more equipped to handle our monetary needs after our working years. The proverbial three-legged stool of retirement income (Social Security, pensions and personal savings,) enabled millions of Americans to plan for a successful retirement. Today two of those "legs" have been chewed away. Tens of millions of Americans saw much of their savings vanish in the financial collapse of 2008. Defined benefit pensions have been widely replaced with 401ks, and although once touted as the salvation of our retirement system, 401ks are increasingly seen as inadequate and mainly benefiting the wealthy.

This leaves Social Security, which is solid but modest with an average benefit of $13,648 a year in 2012. Unfortunately, the majority of seniors rely on Social Security for more than half of their retirement income. Though modest, Social Security works for all Americans, and without it some 21 million people would fall into poverty.

The true cost of high youth unemployment

Currently, Millennials are unemployed at nearly twice the rate of older workers, which will have a massive long-term economic impact, and stymie young people’s ability to build up savings and wealth. The Center for Budget and Policy Priorities (CBPP) recently released an analysis of the Great Recession and its impact on the economy and job market.

CBPP noted that:

Although employers began to add jobs in 2010, the economy has recovered only about 6.7 million of the 8.7 million jobs lost between the start of the recession in December 2007 and early 2010. As a result, nonfarm payroll employment was 1.5% (2.0 million jobs) lower in July 2013 than it was at the start of the recession.

The jobs deficit from this recession is much larger than those in previous recessions. At the average pace of 164,000 jobs a month achieved so far, it will take another 12 months for employment to exceed its level in December 2007 — and much longer to reach full employment, since the population and potential labor force are now larger.

What this means for Millennials is that the bleak employment situation is not likely to lift soon, and that will have a serious impact on young peoples' ability to save for a secure retirement.


Compared to the disappearing and risky alternatives, Social Security is the one retirement system that everyone, including Millennials, can count on. At the same time, Millennials face novel challenges in preparing for our retirement that make Social Security even more important for us, and yet almost all the proposals being discussed would cut benefit more for younger Americans. Our Social Security system works for Millennials, but with the crushing levels of student debt, youth unemployment and the prospect of "good" jobs never coming back, Millennials will need an expanded Social Security system like Senators Harkin and Begich are proposing.