Is the millennial generation the best or worst at saving money? Let's dig into the facts.
While the millennial generation technically spans over a period of fifteen years, it is best to categorize them as men and women who are recently out of college and fresh to the workforce. Today, they are either being blamed, praised, or talked about in some shape or form. However, from a financial standpoint, do we think that millennials are good or bad at saving money?
If you were to stop a group of recent college graduates on the street and ask them how much do they currently have saved for retirement, how many responses do you think you would get that involve the words “Nothing” or “Almost nothing”?
The answer either may, or may not surprise you. According to a recent CNN article, as of 2014, 66% of millennials have next to nothing saved for retirement. This percentage includes individuals between the ages of 21 and 32. Reasonings behind these numbers vary, a lot of them being based off of the stereotypical timeline of the average American. Starting from the beginning — you go to secondary school, you go to college, you get a degree, you do your best to find a job with that degree, you get married, you buy a house …. The timeline goes on. With a timeline like that, it’s easy to assume that the values and priorities of millennials are different than what they once were to the average American man and woman. Between finding a job, figuring out if you want to continue your education and receive a higher degree, and starting a life of your own, who has time to sit down, pick a retirement plan, invest in a 401k, and make sure that they are financially stable for the rest of their life?
This also brings up the question, what should millennials be saving for, if not retirement? If you are just out of college, then there’s still practically an open book of endless opportunities still lying ahead of you. Should it be for something as beneficial and sustainable as a retirement plan, or should it be to pay off certain, and already in action, debts? The options are endless!
Aside from nailing a dream job, most college graduates are too caught up with the idea that paying off their student debt is more important than saving for future endeavors, such as moving out, finding a spouse, buying a house, etc. And on top of that, the option of grad school comes to the thoughts of many. However, in reality, isn’t grad school just adding onto your debt? From those statistics alone, it brings up the predicament: is it true that most would rather throw all of their money and earnings toward their debt, rather than at a bank where it would be safely kept away for something as beneficial as a retirement plan?
The mere question here isn’t if millennials are good or bad at saving, but what are they saving towards? With endless goals and obstacles to face in a matter of decades, it’s hard to pick one specific aspiration and stick to it successfully. It’s a matter of prioritizing what’s most important. To millennials, that can range from starting a career or a family, to expanding their education, while at the same time remaining financially stable in today’s (and tomorrow’s) future economy.