The American Dream is alive and well, especially for millennials -- their top target for achieving that dream is homeownership. But a recent study has found that a staggering number of them are risking their retirement funds to make that down payment on a white picket fence.

WASHINGTON — Despite cynicism and reports to the contrary, the American Dream is alive and well, especially for millennials. And their top target for achieving the American Dream? Homeownership.

But a recent Bank of the West study has found that a staggering number of millennials (those ages 21 to 34) are risking their retirement funds to make that down payment on a white picket fence.

“Millennials are so eager to become homeowners that some may be inadvertently cutting off their nose to spite their face,” Ryan Bailey, head of the Retail Banking Group at Bank of the West, said in the report.

“The fact that nearly one in three millennials who already own their homes have dipped into their retirement nest eggs to finance their down payment is alarming. With careful financial planning, millennials can have it all – the dream home today, without compromising their retirement security tomorrow.”

The study found that millennials’ rush to own has led to some regrets.

According to the study, some 68 percent have expressed buyer’s remorse. Forty-four percent aren’t happy with the space itself, feel like they’re stuck in one place, discovered damage to the house or realized too late that the space didn’t work for them. Another 41 percent feel like they have stretched themselves too thin financially.

“A white picket fence can certainly be a smart investment. To avoid buyer’s remorse, millennials should cover their bases and kick the proverbial tires — reflecting on their physical and financial wishes for a home before they sign on the dotted line,” Bailey said.

Millennials also appear to be hesitant when it comes to investing their money.

A whopping 66 percent say they feel safer keeping their money out of the stock market and 42 percent steering clear of real estate.

The study cites the financial crisis as the prime driver for this, with 65 percent telling Bank of the West that the crisis has made them more conservative investors.

“Millennials have been stuffing their savings under the mattress instead of putting their income to work through strategic investments,” Bailey said.

“While this may seem safe, they are putting their goals at risk by keeping cash on hand. While they are young, millennials have time on their side and could be missing an opportunity to grow their savings over a lifetime.”

Read the full Bank of the West millennial report (PDF).

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