"… If you’re a millennial, you’re not alone, according to a global survey of adults aged 20 to 34 by Manpower Group, a staffing company.
Faced with big piles of student debt, pricey housing and sluggish wage growth, many young adults doubt they’ll be able to retire like much of their parent’s generation. More than a third expect to work well into their 70s. About 1 in 8 said they figure they’ll have to work until they die." …
They will just need to save like Gen X did. You may not be able to start until you are 30ish, but you have to save or you will indeed have nothing at retirement.
This is not the first (or 2nd, 3rd) generation to experience a recession, nor will it be the last. Your job(s) at 24/25 are not forever…I worked in Hell’s Kitchen at a printing company at 25. Nothing to do with my current career. It was a job. I needed money.
I expect to retire in my mid 60s…
When you consider that a huge percentage of baby boomers have almost zero put away for retirement, this expectation is very common among 50±year-olds.
Fewer and fewer people have pensions or employment-based savings plans. What you read among CC parents is not typical, not at all.
I am in my late 50s and I certainly plan to work into my 70s.
Kids coming out of college should be able to do this. Very few “professionals” have pension plans. We just have IRA’s/401k’s.
Many people don’t even think about this when considering a potential employer. It is important once you have some applicable experience to choose your employers wisely. Does it have a 401k plan? Does it match? How much? What other benefits are offered and how much/how beneficial (medical, dental, life instance, educational reimbursement, maternity/patterning leaves, etc). These things are very valuable, and are often worth less actual salary vs an employer not offering them. There is a reason municipal workers and teachers accept a certain salary level. The higher benefits provided and corresponding cost is “worth it”. Kids coming out of school need to be aware of this hidden comp.
Many of the kids I work with here have been out of college 3-4 years and have lots of mobility job-wise. So the period of having little control over your future should pass. It did for me 25 years ago. It does for kids today.
The millennials will have to work long and hard, because we need their Medicare and Social Security taxes to support the aging Baby Boomers. I fully expect the milennials will at some point have death panels, because the system is not going to be able all the Baby Boomers.
Many I know in their 50s and early 60s expect to work forever. Some, of course, have had the unpleasant experience of losing a job at that age and finding that getting another is very difficult. Some work as consultants or in retail. I would also think many millennials will start to put away money for retirement as they get a bit older. I was not saving for retirement in my 20s (spent my savings on grad school) but certainly started after that.
D1 (26, Ph.D student) and D2 (22, rising grad student) have Roths already started. I don’t know how D1’s is faring, but D2 has already turned $5K into $15K. I think they realize the wisdom of eliminating the possibility of SS or even company funded pensions from their savings mentality.
The American way of death is changing, with more discussion about end of life and quality at the end of life. Yes, we need to look at cost and current practices of ignoring odds and going for the faintest hope of cure for usually fatal diagnoses. Death panels is a red herring term, that hopefully has been expunged from intelligent discussions about end of life.
My D recently mentioned that she never expects to retire, never expects to own a house. She is working on her MA, and he sig other is a young professional in DC as well. He has massive loans, she has some, and the loan payoff is the most immediate thing on their horizon. On the other hand, their lifestyle is more indulgent than the frugality with which I lived in my 30s while buying my first house. But home ownership has been more important to my generation, and has been an important vehicle for wealth accumulation.
When you look at their charts it appears 33% think they will retire between age 65-70. 40% expect to retire before age 65.
What am I missing here? Seems pretty optimistic to me. Overly optimistic if I am reading their chart correctly.
and their chart shows 27% expecting to work age 70 and above. Since when is that 1/3rd?
Am I reading these stupid charts wrong or what?
I can’t even get my younger employees to sign up for our 401k. We even sit and do the math for them to show them that putting a few percent away per paycheck is barely noticeable and how much it accumulates to over time. Sure enough anytime anyone leaves we then get the paperwork a few weeks later to sign off on them liquidating their accounts.
My dad just “retired” at the age of 79. He will quit teaching, but he’s going to stay involved in research. He enjoys his work!
My 22 year old S already is putting the max allowed into his company’s 401k (which they match) and has an emergency fund. He makes a good salary (low 50’s) but has no debt except a new car payment. He reads a lot about personal finance to figure out how much he should put away, how much car payment he can afford on his salary, etc. We also pick up a few of his expenses (car insurance, cell phone) because we can afford to do so but also because we want him to put the max into his 401k and let compound interest really work in his favor.
Are they usually cashing out, or are they doing a rollover or transfer?
My H retired at 70.5. Our S has a ton of money in retirement accounts–employer 401K, solo 401k, and Roth IRAs. I believe he has put the max into each for several years now and has at least $50-60k in retirement savings at age 28, plus a huge emergency fund and lives very comfortably. I do not worry about him and think he will work or retire on his terms.
His sister on the other hand is 26 and still 100% dependent on us. We hope her medical issues can be resolved and she can get a job and support herself.
Fortunately, neither child has any debt. That is HUGE.
Unfortunately cashing out. They usually have no clue how much they will be walloped with taxes. We pay 3% whether they contribute or not, so to them it is free money.
Yup. I fully expect to work until I die unless we don’t end up having children.
My mom is 74 and working full time at a hospital in a physically demanding job. She doesn’t particularly like the job. She’s working for one reason only: she needs the money.
She’ll continue to work until she is physically not able to do so anymore, at which point my sisters and I expect we’ll have to subsidize her to some extent.
@emilybee Is he contributing $18k annually? Where I work, the kids don’t seem to know that even though their contribution level starts automatically at 6%, they can simply log in and change it to anything between 0% and 90% (stopping at a max of $18k) and choose either pre-tax or Roth.
Roth especially makes sense if federal tax rate is 15% (or less).
And so do many Baby Boomers. And so do those from most generations.