Six in 10 U.S. millennials think the American Dream — owning a home, becoming debt-free and retiring comfortably — is within reach, yet they are doing too little to achieve this goal, according to a new report from Bank of the West.

Indeed, millennials' conservative investment habits may be seriously compromising their dream of an easy retirement.

Having experienced the damaging effects of the recession, millennials have largely sat out the bull market, and instead have turned to real estate as the cornerstone of their investment portfolio, according to the report.

Fifty-six percent of millennials said homeownership was the main ingredient of their American Dream, followed by 51% who cited paying off debt and 49% who said it was having the financial means to retire comfortably.

But according to Bank of the West, millennials' desire to own a home is pushing some to risk their other goals by taking on mortgages and even borrowing against their retirement savings — one in four said they were willing to withdraw or borrow against retirement funds to finance down payments for a home.

"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 a statement.

"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."

Maru | Matchbox conducted an only survey in early November, which was completed by 1,014 individuals on its proprietary Springboard America panel. Among participants were 609 millennials, equally divided between those 21 to 27 and those 28 to 34; 204 Gen Xers and 201 baby boomers.

Homeownership — and Buyer's Remorse

The survey's findings suggest that millennial homeowners may be rushing into a homebuying decision without asking all the right questions. Sixty-eight percent wished they had been better prepared going into the purchase.

Forty-four percent said that once they had closed the deal, they felt stuck in one place, realized there was damage to the house or discovered that the space was unworkable for their family.

And 41% cited financial regrets, feeling stretched too thin financially, finding it is costly to maintain their home or wishing they had put more money down from the start.

"A white picket fence can certainly be a smart investment," Bailey said. "To help avoid buyer's remorse, millennials should consider covering their bases and kicking the proverbial tires — reflecting on their physical and financial wishes for their home before they sign on the dotted line."

Timing has been millennials' bugbear when it comes to home buying. The study noted that most millennials were not ready to close on a home when housing prices were at their lowest and interest rates hovered just above zero.

And for those who may now feel ready, the 2017 tax overhaul eliminated some of the homeownership tax breaks, removing the ability for homeowners to deduct state and local property taxes from federal tax bills.

Nevertheless, four in 10 millennials in the study were already homeowners, with nearly all others expressing interest in someday owning a home.

And even after having seen how quickly home values could depreciate during last decade's housing crisis, 59% still maintained that it was a good investment or said it made more financial sense to own than to rent.

A study released in December said a first-time homebuyer surge was complicating the housing market.

Ambivalence About Debt

The Bank of the West survey found that millennials have a complicated relationship with debt.

On the one hand, 69% believed that you have really made it only when you are debt-free. Fifty-eight percent said they paid off their credit card balances in full each month.

And when it comes to paying for everyday purchases in person, 59% avoided credit cards and were most likely to use cash, checks or debit cards.

On the other hand, the survey found that on some level millennials were comfortable with leveraging themselves for certain express purposes, such as homeownership, which puts most people into debt for decades.

Forty-three percent said they did not pay their credit card balances off in full each month. Fifty-nine percent of this group purported to feel comfortable carrying this revolving debt — including 66% who were already homeowners.

And when making online purchases, 52% said they were more inclined to use credit cards or credit card rewards, such as cash back or points.

On the Fence

Millennials in the survey expressed great confidence in their own ability to use financial products. Two-thirds said they were confident investing in stocks, and nearly half said the same about investing in more complex options, such as private equity.

Millennials' responses also showed they had age-appropriate attitudes toward asset allocation. Sixty-six percent agreed that the more time they had until retirement, the more aggressive they could be with their investing strategy.

When it came to actual investing, however, 66% of millennials surveyed felt safest keeping most of their savings out of the market — or in real estate.

Sixty-five percent said that living through the financial crisis had made them a more conservative investor as evidenced by their under-utilization of investing accounts that could help them build wealth and prepare for retirement.

Just 40% said they had taken advantage of common workplace retirement accounts, only 23% had opened an IRA or Roth IRA, 14% had a managed account and 12% had a brokerage account.

Recent research showed that retirement saving remained elusive for millennials.

"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."