Running out of money in retirement trumps other stress-inducing pressures such as public speaking and gaining weight for affluent Americans. But despite the prospect of not having enough money to live on later in life, many are unwilling to cut spending on indulgences now in order to invest for retirement – increasing pressures on resources such as Social Security, rather than utilizing employer-based savings tools.

Many mass affluent investors are taking a bit more of “a live for today” financial approach than you might expect, given their fear of running out of money in retirement,” says Aron Levine, head of Preferred Banking and Investments at Bank of America. “That kind of disconnect might have a significant impact on the long-term financial well-being of these investors.”

Millennials, on the other hand, are getting a jump on the retirement game, with many workers still in their teens taking part in employer-sponsored plans. According to new BofA research, the biggest trigger for the mass affluent to begin saving also starts with having a 401(k) offered at work.

Some of the more common reasons richer, older workers say they aren’t regularly saving for retirement include unexpected expenses, paying off debts and paying for a child’s college education. Other indulgences that attribute to today’s spending include entertainment, eating out and vacationing. As well, more women than men are worried about not having enough money in the golden years. However, it’s women that are more reluctant than men to cut back present-day spending.

Most mass affluent people with any retirement savings began saving at 33 years old, but millennials are planning at a younger age — between 18 and 24 — with 80 percent of millennials noting they already have retirement savings.

See also: 7 best practices for 401(k) employee education

For the millennial generation, many work-related milestones can make all the different in their retirement planning, for example:

  • More millennials and Gen Xers than boomers and seniors were motivated to save for retirement when they started their first jobs.
  • Almost three in 10 millennials first started saving for retirement after a raise or promotion at work, versus 10% of older generations.

Kent Allison, a partner in PricewaterhouseCoopers and the national leader of the Employee Financial Education practice, says there are a number of other good retirement routes millennials can take advantage of. For example, he says to look to Health Savings Accounts as a means to save for retirement, in addition to other tax-favored retirement plans (e.g., Traditional and Roth IRAs, etc). “HSA can provide a triple tax benefit if used for qualified medical expenses in retirement and given how health care costs in retirement are a growing concern, this is a great way to prepare for those expenditures now,” he says. 

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