In defiance of conventional wisdom, millennials are saving — and not (just) for avocado toast. Actually, according to a new Merrill Edge report released Friday, young people are "outperforming everyone in saving," only with different goals in mind.
Seriously different goals.
"Millennials are the first generation to plan long-term for financial freedom instead of retirement," says the report. Sixty-three percent of millennials are saving to live their "desired lifestyle," as opposed to 45 percent of both baby boomers and Gen Xers.
Fifty-five percent of boomers and Gen Xers are saving to leave the workforce, whereas millennials are far more lukewarm: Only 37 percent of young people have that goal in mind.
As Aron Levine, head of Merrill Edge, puts it, "Young adults tell us they are willing to do whatever it takes to achieve freedom and flexibility, even if it means working for the rest of their lives."
Millennials appear to have reinvented what to expect of the future. Whereas older generations were largely content to follow the traditional script of work, buy a home, marry, have children and retire, the younger generation has different plans. Less than half, according to these findings, prioritize getting married (43 percent, a drop of almost 10 points from previous generations) and even fewer aim to have children (36 percent, a drop of about 15 points).
Why defer gratification until age 70, at which point one may or may not be able to enjoy it? According to the report, "the majority [of millennials] say they're more likely to spend money on travel (81 percent), dining (65 percent) and fitness (55 percent) than save for their financial future. "
Levine tells CNBC, "They're thinking 10 years or less."
He says, "It really is about, Can they do what they want to do, not only now, but over the course of their life?"
Website designer Grant, , is a prime example. The blogger, who goes only by his first name, turned $2.26 into $1 million by following his passion and turning his side-hustle consulting gig into a successful business.
Still, , "Money is not everything, and it's not worth sacrificing your health, family, friends or other experiences for it."
He concludes that "putting money first" is his biggest financial mistake, saying, "I have lost a few friends and strained other relationships because I've spent too much time staying late in the office or hustling on the weekends. Even though I truly believe that having money is freedom, money is really just a tool to make experiences in life possible."
Though most of them are not as successful as Grant, millennials are saving. In fact, they report that they're saving a greater percentage of their incomes than boomers, Gen Xers or seniors.
Merrill Edge reports that, in short, "perception is not reality when it comes to saving. Millennials say they save 36 percent more than their counterparts, with more than one-third (36 percent) setting aside more than 20 percent of their salary per year."
They're just more likely to save for short-term goals than ones that are decades away.