More Millennials Fear a Financial Crisis Than Retirement Itself

For many millennials, retirement isn’t the scariest financial challenge—it’s what might happen before they get there. From volatile markets to housing unaffordability and shaky faith in Social Security, many younger Americans fear a major financial crisis could derail their plans entirely.

In fact, according to Allianz, 62% of Americans say they are worried another economic crisis could derail their retirement strategy, and among age cohorts, millennials are the least likely to say they’re saving enough for retirement. This economic anxiety is a generational sentiment shaped by decades of instability, but your retirement plan can help ensure you weather a potential storm. Here’s what one expert recommends.

Why Millennials Are So Anxious About the Future

According to Alianz, only 48% of millennials say they are saving enough for retirement, compared to 59% of Gen Xers and 74% of baby boomers, and nearly one-third of all three generations are worried about a recession affecting how much they’ll be able to save. So why the anxiety?

“I think the answer comes easier when we think about the average millennial experience growing up,” says Chris Diodato, founder of WELLth Financial Planning. “The Great Recession of 2008 was our first ‘economic’ experience as young adults.” For many, that meant seeing loved ones lose homes, jobs, or wealth, and entering adulthood into one of the worst job markets in modern history.

That early exposure shaped long-term financial skepticism. “Because of that early experience, I find millennials have a general lack of trust in job security, investment markets, and retirement programs such as Social Security,” Diodato says.

Older millennials who bought homes and started families in the 2010s may feel more secure today, he says, but it’s the younger millennials who may feel priced out of homeownership and have little in retirement savings who Diodato finds “most anxious.”

How to Plan for a Crisis Without Panicking

Rather than downplay those fears, Diodato says taking them into account can help build more resilient plans. “We stress-test our client’s worst fears and integrate that into their plan during good times,” he says. That means modeling for difficult scenarios like a 50% market crash, prolonged job loss, or the loss of Social Security benefits entirely.

By seeing how your portfolio fares during—and after—the bad times, you can avoid panic-driven decisions in the moment. “When something bad happens, we tell our clients, ‘We already tested this. Your plan still indicates success,’” Diodato says.

For Millennials Starting Late, Small Steps Matter

While some millennials feel behind, Diodato insists it’s not too late to make meaningful progress. “Start small. Seriously,” he says, pointing out that saving just $100 per month for 10 years in your 20s and earning 10% per year has you with about $20,000 by year 10 and $200,000 by year 30. “When folks are young, the fact that they have time on their side means small amounts of savings can grow to big sums later in life,” he adds.

To help build healthy habits, Diodato suggests setting up a Roth individual retirement account, automating monthly contributions, and avoiding the trap of watching market performance too closely. “Set it on autopilot and don’t look at your statements at first,” he adds. “I promise, if you’re consistently saving, that after a few years, you’ll be happy with your results.”

The Bottom Line

Millennials’ fear of economic collapse isn’t irrational—it’s informed by the lived reality of recessions, rising costs, and changing social safety nets. The good news? Financial plans that account for worst-case scenarios and emphasize small, consistent progress can help ease anxiety. Start with what you can control—like savings, automation, and revisiting your financial strategy—and remember: Confidence comes from preparation, not perfection.