Millennials: Start Saving for Your Retirement Today!

A jar with money in it. The jar is labeled "retirement."

Photo credit: Tax Credits at Flickr Creative Commons.

Millennials are in an ideal position to get started on retirement planning because the monies they set aside and invest now will grow over time. But starting now is the key.

Starting a savings plan as early as possible will enable Millennials to put aside small amounts of money each month. The smaller amounts are easier to budget for, and the longer the money is invested, the more time it has to grow into enough for a comfortable retirement. Many experts believe that the amount of money needed to retire is in the range of approximately $1 million.

Unfortunately, many Millennials postpone setting aside savings because many already have financial burdens like student loans or credit card debt. Additionally, they often lack access to 401(k) or similar retirement plans if they work seasonal jobs, are employed part-time, are self-employed, or work at small businesses that don’t offer 401(k) options.

In fact, many Millennials haven’t begun saving for retirement yet. A Wells Fargo survey identified that a full 41% of Millennials have not yet started saving for retirement. Some believe it’s fair to assume the percentage of non-savers would be even higher if they included unemployed Millennials in their survey.

There are a variety of reasons Millennials are holding out when it comes to planning ahead. For example, some have just started working or have irregular incomes, so emergency funds are more critical than retirement funds at the moment.

Women find it especially difficult to find the extra money to put aside due to the gender pay gap. In the Wells Fargo survey, women reported median personal income of $28,800 versus the $39,100 earned by men. It’s not surprising then that more women than men (54% to 43%) said they’re living paycheck-to-paycheck.

And the feeling of scarcity isn’t just gender-based: according to the survey, 64% of the Millennials said they would never accumulate $1 million in savings over their lifetime (though it’s worth noting that 73% of the total women surveyed felt this way).

There are a few steps Millennials can take to invest wisely and make the most of their 401(k)s. First, the recent Mobile Millennials survey from Retirement Clearinghouse found that, when changing jobs, 34% of Millennials cashed out of their 401(k)s at least once. Many experts suggest, however, that a 401(k) should be your last resort to cash out on for any reason. Better to find that cash you need elsewhere.

The Wells Fargo survey also reported that 44% who’ve started saving are only putting away 1-5% of their income—quite a small amount when considering your financial future. Wells Fargo advised that a target of 10% would be a better goal, if possible.

Educating Millennials on their finances is another important step. In the Wells Fargo survey, 35% of Millennials said they didn’t know enough about IRAs to consider them. Since IRAs and 401(k)s have nuances that only a financial advisor can really explain, it’s best to consult one in order to best understand the options for each individual.

Millennials come from a variety of financial backgrounds, and each has their own unique situation when it comes to saving for the future. Still, it’s important across the board for Millennials—and for every generation—to take a good, long look at best practices to ensure that retirement is something everyone can look forward to—not dread.

Baby Boomers Don’t Work Harder than Millennials

An older businessman goes head-to-head with a younger businessman.

Photo credit: Shutterstock

By now you’ve probably heard, over and over and over again, that Millennials and Generation Xers are lazy. It’s a really popular “headline” found everywhere from worthless “sponsored links” trying to install spyware on your computer, to otherwise respected media outlets like the New York Times.

Sometimes these articles focus on a specific application or cultural phenomenon (Tinder is a popular one) but they all amount to an attempted moral panic about the kids these days. They all boil down to one argument: people born after 1980 are lazy and don’t want to put any effort into doing things “right.”

The thing is, those articles are wrong. All of them. A recent study by faculty at Wayne State University in Detroit looked at 77 studies on work ethic and found that there were no differences between work ethic over the Baby Boomer Generation, Generation X, or Millennial Generation. They all work equally as hard. Maybe that’s because Baby Boomers didn’t invent working hard, and certainly did not invent the “Protestant work ethic” at the core of American and European workplace culture.

So why does this matter? Because the problem is that people are constantly trying to figure out how to manage Millennials, or how to overcome these perceived failures in their work ethic. But now we know this is a complete waste of time.

Millennials are no more (or less) lazy than older generations, they just grew up with different technology and learned to adapt to it faster. They also face student loan debts that the previous generations never faced in their worst nightmares.

Millennials also live in a far more interconnected world than their parents used to. None of that means they don’t work as hard though, and spending money on finding ways to manage the “problem” of working with Millennials has turned out to be a wasted investment.

Study Finds that 34% of Millennials Watch More Online Videos than TV

Watching TV on Computer

IMG: via Shutterstock

A recent New York Times survey found that 34% of Millennials watch more online videos than they do on an actual TV. That result is a bit shocking, I would think the percentage would be higher. With the lack of jobs out there, a lot of young graduates can’t even afford cable.

Millennials covers the age group of 18 to 34-year-olds. While most generations span about 16 years, I personally think grouping this big age group together doesn’t make a lot of sense. Current 18-year-olds now grew up never knowing a time before cell phones and internet, while those in their mid 20s and 30s clearly remember a time without. Now I will finish my rant and get back to the topic at hand…

The study reported that about one in three Millennials watch less TV than online videos. 50% of those surveyed said they watched online videos at least once per day.

34% of surveyed millennials said they watch mainly online video or no broadcast TV. Only 20% of Generation Xers (Those born in the early 1960s to early 1980s) and 10% of Baby Boomers (born 1946-1964) had the same preference for online videos.

The reasons Millennials gave for watching more online video, 49% said that they like how they can watch it instantly and are able to watch several episodes online.

The study showed that 50% of Millennials who said they watch videos online do so once per day, and 89% said they watch weekly.

Where do you prefer to watch videos?

IMG: via Mashable

IMG: via Mashable

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