My Fellow Millennials …

Kam
Kam
Aug 23, 2017 · 3 min read
Millennial Couple

To paraphrase the late President John F. Kennedy, “Ask not what your future can do for you — but what you can do for your future.”

A recent study from NerdWallet discussed the fate of our generation and retirement (or lack thereof). With the oldest Millennials turning 36 this year, at the rate we’re going, we won’t be able to retire until we’re 75 (current retirement age is 66). Graduates will have to save nearly 15% of their income per year starting at age 25 to replace 80% of their income by age 67. How many of you at age 25 saved 15% of your income? Yeah, me neither.

Most of us are a bit paranoid about money because we grew up during the Great Recession. Our childhood innocence vanished as we watched the Twin Towers fall, heard our parents crying because they got laid off, and discovered that our expensive college degrees meant nothing in an ever-declining job market.

Although the economy is picking up and dusting itself off, we average over $35,000 in student loan debt, and rent is up 11% since 2012. The future looks bleak, my friends. How do we turn it all around and attempt to retire before we’re telecommuting to work from our grandchildren’s basement?

Step #1: Budget.

What an awful word. It sounds like I’m telling you, “Crunch tedious numbers and, in turn, find out that you will never have fun ever again.” What I’m really telling you is to sit down and find out how much money is coming into your household, and how much is going out. It’s not exactly a roller coaster ride, but it’s an easy way to see where all of your money is going — and where you might be able to cut back. Do you really need Netflix and Hulu? Should you attempt to cook a few more nights per week, and bring lunch to work instead of eating at Chipotle every day? A budget will help you determine what you can and cannot afford. Don’t forget — there’s an app for that. Try downloading a budgeting app to help get you started.

Step #2: Don’t Wait.

There’s this thing called compound interest, and, before your eyes glaze over, it basically means that the younger you are when you start saving, the more money you’ll have in the long run. For instance, putting away $300/month at age 25 could get you a little over $1 million by age 65; but that same $300/month at age 35 only adds up to a little over $500,000 by age 65. By waiting just 10 years, you’re missing out on close to $500,000. Start saving now, even if it’s just 5% of your paycheck. Cancel the gym membership you haven’t used in 3 months, lease a cheaper vehicle, make lunch at home, and put that money towards your future.

Step #3: Consult a Professional

We’re very much a “Do It Yourself” generation (hence the rise of Pinterest and YouTube). However, when you’ve had several minor shocks and the light switch still isn’t working, it’s time to bring in the experts. The same rings true for money matters. If you’ve been dabbling in the stock market, are thinking about contributing to your company’s 401(k), or anticipate a life-changing event in the near future (i.e. getting married, having children, purchasing your first home, etc.), you might want to think about discussing your money habits with a professional. Money is a very personal topic, so don’t be afraid to interview several financial advisors before selecting the right one.

Our future doesn’t have to be bleak. If we would just take a moment to plan, our golden years can still be “golden.” In the wise words of Dr. Emmett Brown, “Your future is whatever you make it, so make it a good one.”

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Kam

Written by

Kam

Digital Marketing Maven | Wordsmith | Financial Wizardry | Generational Differences | Explorer, Dreamer, Discoverer | General Musings ✌🏻

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