Thanks to inflation, $1 million is no longer what it used to be. In 40 years (around the time millennials will be retiring or in retirement), $1 million in savings would have the same spending power as $306,000 today, Business Insider previously reported, citing a 2016 Time magazine estimate.
According to one financial planner, for millennials who are currently 32 and plan to retire at age 67, the average annual withdrawal from $1 million in savings will be below the poverty line based on inflation.
This means that millennials need to save even more for retirement. That's not good considering 25 to 34-year-olds are only saving 5.3% of their income, according to Vanguard, which manages 401(k) accounts for 4.4 million Americans.
Many millennials are also investing unwisely, preferring to use cash investments, which don't yield great returns.
"Millennials are going to have the biggest retirement-savings burden in history," Greg McBride, the chief financial analyst for Bankrate.com, previously told Business Insider. "The nest egg that they're going to have to accumulate on their own is going to be bigger than any other generation."