In a not so shocking, yet disturbing report by CNN Money, it was announced that 66% of millennials have not saved a single penny for retirement.
This doesn’t surprise me, to be entirely frank. I keep seeing the younger crowd buying the latest iPhone, the most popular video games, and designer clothing, all before dropping a meager $50 into their savings. In a world of social media bragging wars, many of the young professionals focus on fancy cars, jewelry, and anything that is deemed trendy.
Sure, I get the fact that there are bills, loans, and rent. However, people like me, approaching 40, were in the same boat at one point. I was taught early and often the value of saving money, even if it’s only a small percent of every paycheck.
21 – 32 Crowd Not Saving Well
While the report did’t shock me, the depth of the problem did. A reported 66% of people aged 21 to 32 have zero saved up for later. This is according to the National Institute on Retirement Security and it draws on 2014’s Census data.
This drastically hampers retirement at an early age, because saving early and often is the key to financial freedom later in life. Whether it’s doing something as simple as starting a ROTH ira, or just contributing to a traditional ira, you really don’t have to invest much to see the benefits of compounding interest.
The report continued to highlight the one third of this group that are actually saving up for retirement. While they did say that most have less than $20,000 saved, there are outliers that have saved up more money, and of this third of the group the average balance is over $67,000. Taking advantage of an employer’s plan, such as a 401k, seems to be the norm for millennials.
Call me old school, but unless I’m in dire straights and have debts or bills that are absolutely crucial, I sock away money on a monthly basis. However, my Father, and his Father before him, were a driving force in teaching me how to be a disciplined investor. I give thanks daily for the values they have instilled on me.
About Tim Schmidt
Tim Schmidt is an Entrepreneur who has covered retirement investing since 2012. He started this website to share his expertise in using his Self-Directed IRA. Most recently he's been advising individuals to diversify into precious metals ahead of a certain recession. He invested with Goldco.