E*Trade released a report indicating that young investors, those between the ages of 18 and 34, may be overly confident about retirement. While 89% are either somewhat or very confident they will save enough to enjoy their retirement, 59% have taken an early withdrawal from their retirement account.
This group thinks they will need between $250,000 and $999,999 for a successful retirement, but Baby Boomers think they will need between $1 million and $2 million to retire comfortably. While 44% of young investors would recommend that a friend or member of their family save between 6% and 10% of their income for retirement, only 38% are doing so themselves.
“Saving for retirement continues to be a key challenge and core area of focus for investors,” says Mike Loewengart, vice president of investment strategy at E*Trade Financial. “While some young investors have started on a solid savings path, many are exhibiting behavior that runs counter to their goals. There’s a need to bridge the gap between education and action, and the good news is, it’s never too late.”
E*Trade’s findings are based on a survey of 284 young investors conducted in July.