49% of Millennials spend more on dining out per month than they put towards retirement.
Why Millennials are Far Behind
- 3 in 10 employed millennials say they’ve received a pay cut during the economic recession caused by the coronavirus pandemic.
- Nearly 1 in 5 millennials say they lost their job due to the pandemic-induced recession.
- Among all adults, 27% say they suffered a pay cut and 11% say they lost their job because of the pandemic.
Tips for Millennial Earners
- Take advantage of the company offered 401K: It remains the easiest way to allocate untaxed dollars towards retirement, along with an employer contribution.(If your employer will match your contribution, this is a huge plus!)**
- Make a plan: Yes, you are decades from retirement but that doesn’t mean you can’t ask yourself a few simple questions:
- What do I want my retirement to look like, financially?
- Where will I live?
- Will you be taking care of elderly parents?
- Educate yourself:
- Learn about savings rates
- Understanding how to avoid unnecessary debts(including student loan debt)
- The psychological aspects of money & peer pressure
- Keys to not overspending
- Set up a budget: You can modify it monthly or annually as your salary and expenses change.
- Avoid credit card debt: We want to enjoy the feeling of spending money; and we also want to be good stewards and get our money to grow. The big question is how to balance it all on a budget? When we borrow on a high-interest credit card there is a feeling of regret — the joy of the experience is often blurred by the debt accrued by the expenditure. You can have a small percent of your income allocated as an entertainment fund, but the lion share should be used to build assets and pay bills.
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*This example is hypothetical only, and does not represent the actual performance of any particular investments. Investments in securities do not offer a fixed rate of return. Principal, yield and/or share price will fluctuate with changes in market conditions and when sold or redeemed, you may receive more or less than originally invested.
**Distributions from traditional employer sponsored retirement plans are taxed as ordinary income and, if taken prior to reaching age 59½, may be subject to an additional 10% IRS tax penalty.
Learn more about FiscaleFit — our self-directed financial planning resource to help you gain financial clarity and position every dollar to make the most impact in your life.