For many Americans, the ability to retire early, even at the young age of 50, represents the ultimate dream – a reward after decades of hard work and saving.
However, while early retirement remains a highly desirable goal, a new survey reveals it often takes a back seat to what is viewed as a more pressing need: buying a home.
Retiring Early Appeals to Younger Generations
The survey, conducted by fintech platform SoFi and polling over 2,000 adults nationwide, found that nearly one-third of respondents would like to retire by age 50.
This desire was especially pronounced among younger generations like Millennials and Gen Z, who have grown accustomed to the instant gratification of the on-demand culture.
For these younger Americans, the classic retirement age of 65 seems impossibly far off. They would prefer not to wait that long to stop working, even if it means sacrificing and saving more now to make early retirement achievable.
Americans Willing to Forego Short-Term Pleasures
In fact, the survey showed a willingness among many respondents to give up small luxuries today to reach that early retirement goal tomorrow.
For example, around two-thirds said they would be willing to stop eating at restaurants for five years if it meant shaving five years off their retirement timeline.
Similarly, many said they would forego attending weddings, even missing those of close friends or family members. Some even indicated willingness to skip having a wedding themselves in order to funnel more money towards retirement savings.
Retirement Contributions Fall Short for Many
However, the survey also revealed that nearly half of respondents feel they are not saving enough for retirement currently. This sentiment was especially common among women, only 43% of whom said they are on track with retirement contributions, compared to 54% of men.
Of those who are saving, men were also more likely to be aware of their total retirement savings amount. This suggests many Americans, especially women, lack confidence in their retirement preparedness.
Short-Term Goals Take Priority Over Retirement
When asked about top priorities for the next six months, retirement contributions trailed behind more immediate needs. The top goal was making more money overall, followed by living more comfortably now and spending quality time with family.
This focus on short-term financial and lifestyle goals appears tied to covering basic costs. Survey respondents viewed earning between $50,000-$75,000 as the income range required to meet their ambitions. For most, this seems more about achieving financial security than getting rich.
Buying a Home Trumps Early Retirement
While retiring early was alluring for many, buying a home came out on top as the ultimate financial aspiration. A full 70% said owning a home was more important than being able to retire at 50.
This discrepancy highlights the rising difficulty younger Americans face when trying to enter the housing market. While they may dream of retiring early, the more urgent priority for most is affording a home in the first place.
Younger Generations Reshaping Retirement Trajectory
The survey makes clear that younger generations have a vastly different view of retirement than previous cohorts. Rather than patiently await their golden years, Millennials and Gen Z crave financial independence at a much earlier age.
However, systemic economic challenges make this extremely difficult. Stagnant wages and ballooning housing costs force younger Americans to focus more on short-term necessity than long-term dreams. Even for diligent savers, early retirement may remain tantalizingly out of reach.
Still, the shifting priorities of younger generations seem likely to redefine retirement timelines and traditions. While early retirement at 50 may not be realistic for many, these expectations could drive changes like more flexible work arrangements later in life.
This would allow people to transition more gradually into retirement rather than abruptly stopping work.
The path to early retirement is undeniably arduous. But this survey makes clear that, while other goals like buying a home may take current precedence, the desire remains strong among many younger Americans to achieve financial freedom well before their golden years arrive.