Debt Jeopardizes Millennial Educators' Retirement Savings

Millennial educators proactively save for a secure retirement while also welcoming professional financial advice, new research from Security Benefit reveals

Topeka, KS - August 22, 2018 - Saving for retirement ranks as a top long-term financial goal among millennial educators, yet tackling credit card debt and student loans is a major barrier, according to a new study from Security Benefit, an innovative leader in the U.S. retirement savings market.

Security Benefit has a long-term working relationship with the education market and decided to take a closer look at how the millennial generation of educators viewed retirement savings.

Paying off credit card debt and student loans more adversely affects millennial educators than their peers, the study also found. More than half (58%) of millennial teachers report having credit card debt along with 64% of non-teacher (administrators, specialists, etc.) millennials. In addition, 56% of millennial teachers report having student loan debt compared to only 39% of non-teachers. Both groups noted that these loans are a major barrier to reaching their financial goals.

“Debt is a generational problem, and when compounded with today’s rising tuition, high cost of living and growing childcare expenses, millennials are in a tough spot,” said Al Dal Porto, Vice President of Product Development at Security Benefit. “Although many millennial educators are taking the right steps to securing their financial futures, financial professionals can guide this generation by understanding their common obstacles, acting as a trustworthy source and addressing their unique needs.”

Take control. Despite these obstacles, millennial educators aren’t afraid to take control of their finances. While 66% of millennial teachers have access to a pension, only 33% expect to fund retirement strictly on a pension. The study also found that as a whole, 76% of millennials have access to employer retirement savings plans, and 80% contribute to them.

Retirement planning help wanted. Millennial educators said they need help with retirement planning, especially when it comes to determining an appropriate asset allocation or the best investment vehicle. Millennial educators tend to first research budgeting and investing strategies online. However, 73% said they are likely to work with a financial professional in the future and 41 percent currently work with one (versus only 17% of non-teachers that work with a financial professional).

Personal relationships are key. For millennial educators, developing a personal relationship with a financial professional is especially important; 80% would prefer to work with a financial professional in person. Although millennial educators value in-person interactions, 74% are at least somewhat interested in using an app for help with retirement savings. Even so, 77% of millennial educators would place most of their trust for financial advice with a financial professional.

This study was conducted in partnership with researcher Greenwald & Associates and is based on qualitative and quantitative research from U.S.-based educational professionals ages 21-37. Click here for a more detailed look into how millennials are preparing for retirement.

Michael Castino

Director of Public Relations, Security Benefit

About Security Benefit

Security Benefit Corporation (“Security Benefit”), through its subsidiary Security Benefit Life Insurance Company, a Kansas-based insurance company that has been in business for 128 years, is a leader in the U.S. retirement market. Security Benefit together with its affiliates offers products in a full range of retirement markets and wealth segments for employers and individuals and held $41.1 billion in assets under management as of December 31, 2019. Security Benefit is one of the fastest growing U.S. retirement companies and continues its mission of helping Americans To and Through Retirement®.