Millennials want to retire by 61, but most have nothing saved

[TwiceHorn 31435]

10 hours ago, 52-80 said:

BTW yall see that Brandeis charges 55k a year on tuition alone?  I know their parents are wealthy Hebrews and they get Levantine scholarships but holy schnike

I think that's pretty par for Eastern private schools.  And not just Eastern, a lot of private schools that consider themselves hoity-toity charge that much.

[TwiceHorn 31435]

Double.

Edited July 19, 2018 by TwiceHorn

[TwiceHorn 31435]

2 hours ago, Bevo VIII said:

I would suggest robotics, instrumentation, or controls/plc.

Problem might be, if you already know you have aptitude for this stuff, why not college for BSME.  I have encountered a lot of techs that are pretty sharp that wish they had gone to full-blown college.

[pearlandhorn 3269]

I'm 30 years old.  Current company doesn't match 401k.  I'm contributing a bit to that and also maxing a Roth IRA (wife is also contributing max IRA).  College fund set up for 2 year old with a good chunk for about 3 semesters worth of funds at UT in it so far.  We still save about 20/30% a month based on one income (she is SAHM until kid goes to school).  Also have investment accounts set up with a substantial amount that we've contributed over the years.

The fact that people my age have less than $19k in "retirement" is nuts.  But then again, I'm a CPA and know the value of saving early for retirement.  I guess most millennials are banking on their parents giving them inheritance.  That's the equivalent of planning on medicare and social security being around when I get that age.  I guess I'm of the mindset that I shouldn't plan on free shit so I have to do it myself.

[TwiceHorn 31435]

1 minute ago, pearlandhorn said:

I'm 30 years old.  Current company doesn't match 401k.  I'm contributing a bit to that and also maxing a Roth IRA (wife is also contributing max IRA).  College fund set up for 2 year old with a good chunk for about 3 semesters worth of funds at UT in it so far.  We still save about 20/30% a month based on one income (she is SAHM until kid goes to school).  Also have investment accounts set up with a substantial amount that we've contributed over the years.

The fact that people my age have less than $19k in "retirement" is nuts.  But then again, I'm a CPA and know the value of saving early for retirement.  I guess most millennials are banking on their parents giving them inheritance.  That's the equivalent of planning on medicare and social security being around when I get that age.  I guess I'm of the mindset that I shouldn't plan on free shit so I have to do it myself.

I'm not sure those millenials are banking on anything.  And if they had to finance education, I don't know what on earth would make them think they can rely on an inheritance.

[52-80 19142]

34 minutes ago, Trey3216 said:

Prepaying for having to lie on their back a few times per month for the next 15-40 years???

 The lucky bastards.

[SimonBolivar 10957]

We do pretty well with our retirement. I'm 29 and I do 15% and the company puts in an additional 10% for a total of 25%. The woman is putting in 15% with a company maymtch of 6% so she's only at 21% but she's also only 23 so we should probably pump her up to 25% if we can.

Edited July 19, 2018 by SimonBolivar

[ImissWallyPryor 9046]

47 minutes ago, clapclapclap said:

Sorry, someone hacked my account.

I meant "Them elves."

 

BTW, this is the type of poll where there are no wrong answers, except for three.  Are the Classics like Tito and Jermaine no longer taught?  Those who cannot remember the past are condemned to repeat it.  

Fantastic!  I voted for Them elves.  Call it a hunch.  If the lead holds, what do I win?

Edited July 19, 2018 by ImissWallyPryor

[Aqua Buddha 14581]

6 minutes ago, TwiceHorn said:

I'm not sure those millenials are banking on anything.  And if they had to finance education, I don't know what on earth would make them think they can rely on an inheritance.

Inheritance is the great unseen hand on wealth in America.  It's not just a pile of money when someone dies.  It's having no school debt, getting a down payment on the first house from dad, grandparents paying for the grandkids college, etc.  The people who are getting the pile of money when someone dies also likely got help along the way in various forms.

It's way two families of similar incomes can have wildly different wealth positions at middle age.  Millennials will be no different.  The ones that has rich parents will be fine in retirement.  The others, not so much.

 

[Js1 85261]

10 minutes ago, TwiceHorn said:

I'm not sure those millenials are banking on anything.  And if they had to finance education, I don't know what on earth would make them think they can rely on an inheritance.

I am 100% not banking on an inheritance. The great 3 figure inheritance from my Boomer folks ain't going to do shit.

As usual, to many of you on here, CONGRATULATIONS on being so financially secure and in a great place.  Your unheralded, unparalleled successes in life definitely should be TRUMPETED over the struggles of your fellow generation who maybe didn't have all the best support systems you did growing up.

But we really, really are inspired by your ability to tell us how successful and prepared you are/will be and how we the rest of us are just entitled and "banking on" being bailed out.

[936horn 910]

27 minutes ago, Js1 said:

I am 100% not banking on an inheritance. The great 3 figure inheritance from my Boomer folks ain't going to do shit.

As usual, to many of you on here, CONGRATULATIONS on being so financially secure and in a great place.  Your unheralded, unparalleled successes in life definitely should be TRUMPETED over the struggles of your fellow generation who maybe didn't have all the best support systems you did growing up.

But we really, really are inspired by your ability to tell us how successful and prepared you are/will be and how we the rest of us are just entitled and "banking on" being bailed out.

I don't necessarily view it at trumpeting successes to make others feel bad, but rather providing some counter points to the endless stream of "lol milennials will never retire" articles (though yes a few probably are just trying to brag). Something I think most folks in a similar position can agree upon would be not having any school loans was life changing - even if you don't realize it at the time. Where I grew up I didn't know anyone took out loans for college. I still am not quite sure what it cost me to go to UT but I believe tuition was somewhere around 9k/semester. Looking back now, to Aqua Buddha's well articulated point, this was probably the single biggest thing in life that could set me ahead. At the time I had no idea how big of a deal this was. I thank my parents to this day for that gift, and I have already started saving for my 2 year old's college fund.

I hope most people can recognize that a huge gift of no debt is like starting on the 40 yard line while anyone else with student loans got two yards out of the endzone on the kickoff (or got tackled for a safety)

Edited July 19, 2018 by 936horn

[Pato del Muerto 52485]

There should be inheritance for me, but our plan is to use that to ensure our kids start their careers debt free with reliable vehicles. 

I was told my whole life I had to go to college, but when the time came there was nobody paying for it but me. 

So I see it as my responsibility to make sure my boys don’t have the same struggles starting out, even if it means I work until I die. 

Also, the inheritance is coming from my wife’s side of the family. My folks might have enough to retire on eventually, but that will deplete almost entirely if they live to decent ages. Unless they have money I don’t know about, which would just make me bitter that they haven’t helped out with the student loans that I’ve been paying on for the last 20 years. 

Edited July 19, 2018 by Pato del Muerto

[pearlandhorn 3269]

12 minutes ago, 936horn said:

I don't necessarily view it at trumpeting successes to make others feel bad, but rather providing some counter points to the endless stream of "lol milennials will never retire" articles (though yes a few probably are just trying to brag). Something I think most folks in a similar position can agree upon would be not having any school loans was life changing - even if you don't realize it at the time. Where I grew up I didn't know anyone took out loans for college. I still am not quite sure what it cost me to go to UT but I believe tuition was somewhere around 9k/semester. Looking back now, to Aqua Buddha's well articulated point, this was probably the single biggest thing in life that could set me ahead. At the time I had no idea how big of a deal this was. I thank my parents to this day for that gift, and I have already started saving for my 2 year old's college fund.

I hope most people can recognize that a huge gift of no debt is like starting on the 40 yard line while anyone else with student loans got two yards out of the endzone on the kickoff (or got tackled for a safety)

Here here on the no student loans.  A lot of my peers in college had them and I simply had no concept of it.  I'm paying it forward for my 2 year old.

[Dahobbs 17522]

56 minutes ago, SimonBolivar said:

21% but she's also only 23 so we should probably pump her up to 25% if we can.

Phrasing? Are we still doing that?

[Telegraph_it 3357]

Inheritance is the great unseen hand on wealth in America.  It's not just a pile of money when someone dies.  It's having no school debt, getting a down payment on the first house from dad, grandparents paying for the grandkids college, etc.  The people who are getting the pile of money when someone dies also likely got help along the way in various forms.
It's way two families of similar incomes can have wildly different wealth positions at middle age.  Millennials will be no different.  The ones that has rich parents will be fine in retirement.  The others, not so much.
 

Pretty much this; it helped us start ahead of he curve. My wife knows we will get a seven figure something and doesn’t think we need to save for retirement period. Just in case my FIL is in cahoots with Russians I don’t listen to her.

[Incredulity 11646]

Rio, the correct answer is Rio

[phdhorn 6224]

I'm a late boomer who married almost a decade younger than me.  She has a great 401K and other stuff and will be working when I'm well (I mean WELL) past avg. retirement age.  I probably won't even think about "retirement" money until I'm in my 80's.  I'll have to start withdrawing retirement money in a few years, but hell, that's just for booze and playing the horses, not shit I need to live (well, other shit I need to live besides booze and horses).

Solution:  marry an up-and-comer who's a lot younger than you.  Then you're actually living on "normal" work wages far beyond when retirement is necessary.

[Sbbruin 21828]

I hope to retire by 65, but it will take the wife accepting a more modest lifestyle.  That's fine by me.  But she'll be tough.  

[52-80 19142]

1 hour ago, thestud said:

Yeah kids, everything that cookie said to do, don’t do that.

 

[Brew 3049]

3 hours ago, Js1 said:

I am 100% not banking on an inheritance. The great 3 figure inheritance from my Boomer folks ain't going to do shit.

As usual, to many of you on here, CONGRATULATIONS on being so financially secure and in a great place.  Your unheralded, unparalleled successes in life definitely should be TRUMPETED over the struggles of your fellow generation who maybe didn't have all the best support systems you did growing up.

But we really, really are inspired by your ability to tell us how successful and prepared you are/will be and how we the rest of us are just entitled and "banking on" being bailed out.

Support system? My parents are alkies and I’m the only one of my 5 siblings to have gone to college. I worked through high school and college, got married at 20, and now make double what the 5 of them, their 2 spouses, and my parents make combined. Damn, the high school and college I graduated from don’t even exist at this point because they sucked so bad.

[Brew 3049]

10 minutes ago, OatmealRaisinCookie said:

Was my take outlandish or something?

I mean it does give you the ability to kill yourself as a retirement planning option for your wife.

it’s not outlandish but it should be looked at as a piece of an overall financial plan. All young people with kids, no real net worth and a loss of income issue should have life insurance in case something happens. I have $2.5M on me but don’t carry any on my wife.

Edited July 19, 2018 by Brew

[TwiceHorn 31435]

4 hours ago, 936horn said:

I don't necessarily view it at trumpeting successes to make others feel bad, but rather providing some counter points to the endless stream of "lol milennials will never retire" articles (though yes a few probably are just trying to brag). Something I think most folks in a similar position can agree upon would be not having any school loans was life changing - even if you don't realize it at the time. Where I grew up I didn't know anyone took out loans for college. I still am not quite sure what it cost me to go to UT but I believe tuition was somewhere around 9k/semester. Looking back now, to Aqua Buddha's well articulated point, this was probably the single biggest thing in life that could set me ahead. At the time I had no idea how big of a deal this was. I thank my parents to this day for that gift, and I have already started saving for my 2 year old's college fund.

I hope most people can recognize that a huge gift of no debt is like starting on the 40 yard line while anyone else with student loans got two yards out of the endzone on the kickoff (or got tackled for a safety)

Yeah I'm not really trying to put anyone down.  Curiously, my parents had their college education paid for by their parents who were not at all rich, a farmer (whose daughter, my Mom, didn't have indoor plumbing until college) and a storekeeper (both in horrible, benighted, white trash Arkansas), who was able to cover Dad's first tuition bill solely because a customer came and paid off a largeish credit balance accumulated during the depression (Dad fucked up and elected a lump sum instead of a payment plan).  My parents didn't inherit shit from their parents (except the farm plot, which has actually evolved nicely into a "tree farm").

My parents then took it as gospel that my college education would be paid for and began saving for it long before I was even born/adopted, and postponed having/adopting a child in part because they considered being able to put me through school an obligation of parenthood as it was for their parents.  It helped a lot that I wound up choosing UT.

They saved and scrimped and avoided divorce and other catastrophic financial/personal decisions.  I had summer jobs (engineering intern type) that my Mom made me put most of in an IRA (that tells you about all you need to know, right there).

So that's my Johnny Sack story of privilege and trust-fund babyness.

Edited July 19, 2018 by TwiceHorn

[clapclapclap 9000]

 

Edited July 20, 2018 by clapclapclap

[Underdog 28544]

8 hours ago, Trey3216 said:

Prepaying for having to lie on their back a few times per month for the next 15-40 years???

What’s this per month bullshit you speak of?  

[Okie State 3804]

Must have a birthday and anniversary every month.

[TexArcher 37761]

I'm a financial advisor and I cringe every time a client wants to refer a millennial to me.  They just don't listen.  You can show them all the graphs and projections in the world, and they will continue to put 4% into their 401k and spend the rest.  Don't even get me started on life insurance or long-term care.  They're all going to see 40 countries by age 40 and retire at 60 with $150k to last them 25 years.  No problem.

[Okie State 3804]

I'm a financial advisor and I cringe every time a client wants to refer a millennial to me.  They just don't listen.  You can show them all the graphs and projections in the world, and they will continue to put 4% into their 401k and spend the rest.  Don't even get me started on life insurance or long-term care.  They're all going to see 40 countries by age 40 and retire at 60 with $150k to last them 25 years.  No problem.

I would guess most of these are in their 20's? I'm 34 and technically a Millennial by at least some definitions. Everyone I know around my age has at least some kind of plan and has been saving as much as they are able since day one. A few of the younger people I unofficially 'mentor' don't seem to have much of a plan at all.

[TexArcher 37761]

Yeah, the older millennials are better listeners than the twenty-somethings.

Just about everyone under 30 lists several financial priorities, including travel, ahead of saving for retirement.  A lot of these same kids who want to retire at 61 also want to buy a house by 30.  When they get to 30 and have no downpayment for a house, maybe they'll wake up to the fact that making up a goal and an age isn't exactly a strategy.

But I doubt it.  If I had to guess, the average millennial will be working until 75.

P.S. Get off my lawn.

[Brew 3049]

Very few younger people have a plan for 40 years down the road. I didn’t get serious until around 30 and even then it was only semi-serious sliding towards more serious as I close in on 40. My 20’s involved travel, boats, trucks, and who knows what else.

[Okie State 3804]

I won't lie and say I don't wish I had spent more time traveling in my 20's before I had kids. I started out of the gate at 21 with a decent retirement plan, but didn't have a ton left over for all the fun stuff. If had it to do over I probably would balance that a little better.

[Newdoc 3439]

23 hours ago, Anastasis said:

least from a financial perspective, apprenticing with an electrician with an endgame of opening up my own shop. It would have probably been more rote and boring, but in the end the better play. 

This. Been preaching this for a couple of years in the face of my kids eye balling $60k a year colleges.

I have been encouraging hs grads that look at TSTC in Waco because you can get a top notch tech degree and combine that with some business classes and you’ve got a great chance to make a damn good living and be your own boss if you choose.

[DanRydell 799]

Going to 40 countries by 40 sounds way more appealing than owning a home at 30 or being retired at 75.

[CooterBrown 18002]

Going to 40 countries by 40 sounds way more appealing than owning a home at 30 or being retired at 75.

If I had to do it over again, I’d do the 40 by 40 instead of working a real job.

[RiceOwl 74]

Perspective from a "Young Millennial" (or some say I fall outside of it having been born in '96) who just graduated college and recently started my first job out of school:

-Coming out of school with no debt is a huge, huge, huge relief. I can't tell you how many friends of mine are financially hamstrung by having large amounts of debt (and this is coming from a school like Rice that supposedly has great financial aid). It's not so, so bad for those of us entering industry/consulting/banking but for those looking at another several years of PhD/Med School/etc, it sucks. 

-Lots of companies don't give great 401k matches. I work for a Fortune 50 and our match is only 2% with another 2% ARC (this gets higher as you get older/work there longer). Better than nothing, yes... But hardly going to make your 401k fat. Ultimately, it looks like I'll have the equivalent about 7-8% of my income into my 401k my first year of work. This would be higher if I didn't have a bunch of "one-time" expenses like a car down payment, buying furniture for my apartment, etc.

-There are lots of 20somethings who want to "live their best life" during their 20's... Whether that's outlandish travel, bottle service every weekend, $30/session workout classes, it all adds up. Personally, I took tons of hours during college so I could finish a semester early and get the travel bug out of me before I started work... Probably only domestic travel for me for a few years now (maybe Canada or Mexico but that doesn't really count). I actually find that the correlation between income and travel is inverse. My friends who are making the most money (in IB) have no time to travel, those of us in the middle have some time but are also reasonably smart about their money, and its the poor ones who have lots of time AND poor financial management skills.

-I think some on here underestimate the cost of housing... Obviously housing prices in most Texas cities have gone through the roof, making it difficult to buy. That said, it's even difficult to find a cheap one bedroom to rent in Dallas if you want to live in a decent area. I'm not even talking luxury high rises. I'm just talking about a place where people don't do/sell drugs out in front. Another thing about most Texas cities is that there isn't the same stock of brownstones, three-deckers, etc. where you can live with five of your buddies for fairly cheap like you find in much of the northeast.

[Guest]

5 hours ago, Brew said:

I mean it does give you the ability to kill yourself as a retirement planning option for your wife.

it’s not outlandish but it should be looked at as a piece of an overall financial plan. All young people with kids, no real net worth and a loss of income issue should have life insurance in case something happens. I have $2.5M on me but don’t carry any on my wife.

 

5 hours ago, OatmealRaisinCookie said:

Yea, I think we are agreed. The only reason I mentioned it in this thread is because if you have nothing saved or little saved, $50-100 a month for 1,2 or 3mm is a no-brainer. Especially with young/young-ish kids and a wife who earns nothing or considerably less than yourself.

Plus, I'm telling you, there is a real freedom to it. Not that one wants to die, but they aren't afraid to, whether it be from accident/tragedy or for the right causes and reasons, etc.

You gave sound advice. The amount (and type) of life insurance you have, which if you’re married and/or with kids is a must, should be contingent upon your income. For example some millenials make $50K and some $1MM. But Brew is correct that it ought to be a piece of the picture and not the whole deal. 

[Blotto 23486]

9 hours ago, OatmealRaisinCookie said:

Perhaps a weird tangent here, but I'm a millennial and I think more young, good earning millennials should take out a hefty (more than 1, likely 2 or 3mm) term life insurance. It 1) assures your wife/kids will be taken care of in your untimely death to replace your practical/real earnings you would have gotten for 30 years, 2) it helps to safeguard against NOT having a robust retirement/savings/inheritance fund for your wife and kids and 3) for $50/mos there is a huge psychological and spiritual freedom when you can just live life and be fearless (note: not stupid or Darwinian) because you don't have it in the back of your mind that if you croak what will your stay-at-home wife and young kids do and you always have some chip of a burden.

My $.02, but then again I was a Liberal Arts guy at UT and wasted all my time and money on a "worthless" piece of paper so what do I know 😉

 

edit to add: Make sure your kids aren't like that aggy kid who off'ed his jeweler dad for inheritance or life insurance.

Please humor me and provide a few examples of how taking out a term life policy has enhanced your freedom? We talking wingsuits? Barebackin' in Haiti? I would think that the responsibility of having a family would be enough to govern your behavior, so I'm curious about this new found freedom.

[burntorangebongos 10710]

I'm sure he means peace of mind...freeing the mind from worry.

[Helobious 9456]

Im a couple years older than RiceOwl, but I concur with a lot of what he said. Granted he seems more successful than I am and he went to Rice, but I recently stayed at a Holiday Inn Express so I know intelligent thoughts when I see them.

When I go back to my hometown, I see a lot of the elderly dudes in the barrio everyday hanging out in the shade, drinking beer and playing cards or whatever, seemingly not a care in the world. I always looked down on them for being shit poor and stupid and doing nothing of substance with their lives.

As I get older and rack up the days of my life I’ve spent doing a job I don’t even like much, worrying about my current bills and putting away money for some far off time, I do start to kind of wonder who the dumb one is.

 

[Brew 3049]

^^^have had this thought a lot recently. It’s similar to the story of the fisherman that catches enough for his family and to make a little money and then the investment banker tries to sell him on buying a fleet of fishing boats so he can basically end up doing the same thing he does now. Life would be a lot simpler without the chase, but I think I would get bored. Signed a contract today to sell a side business, signed one today to buy a different one. I think I have adult ADHD at this point and just can’t sit still for a moment.

On the stories of the wives with degrees above, I had a lunch meeting today with a stay at home mom with a degree from Vandy and a PHD from Duke in some sort of medical research. She hadn’t worked a single day because she got pregnant 13 years ago in the final year of her PHD program.

[Mole 4330]

Uncle Sam has a great plan to get some work and life experience, college money (the Post 9/11 G.I. Bill is fantastic), and get the travel bug out of you. You'll get lots of exercise too.

I think a really good plan for a responsible kid without much financial support to get an education without loans is to join the military, knock out as many online core classes as possible (at a real school) using tuition assistance while you're in, and finishing your bachelor's and most or all of a master's using the GI bill. If you play it right, you could be mid/late 20s with a graduate degree, no student loans, eligibility for a no-down-payment VA home loan, maybe a little money saved up, and some military service on your resume. It would take focus, but it can be done.

[TexArcher 37761]

Absolutely agree with that.

[Mole 4330]

You also get access to the sweet American Legion darts action.

[Pato del Muerto 52485]

Well after I was out of school, I decided that I should have pursued the deal the service branches have where they pay for your pharmD and then you fulfill your commitment to them as a pharmacist. Free school and first job. Then go work at Walgreens or cvs at any town in America. 

[RD3 64]

I have maxed out my 401k since I started working 15+ years ago. My company has had some match but at this point I don't even remember what it is.  I basically take as much tax deferral as I can.  Max out dependent day care, health care savings account...  Bottom line:  decrease your taxable income as much as possible and find a way to live off the rest of your paycheck and keep saving more on top of that.

[936horn 910]

6 hours ago, RD3 said:

I have maxed out my 401k since I started working 15+ years ago. My company has had some match but at this point I don't even remember what it is.  I basically take as much tax deferral as I can.  Max out dependent day care, health care savings account...  Bottom line:  decrease your taxable income as much as possible and find a way to live off the rest of your paycheck and keep saving more on top of that.

Yes this too. I was trying to explain this to a buddy of mine (we are 30) and I think a light bulb went off for him. 401k, HSA, 529, do whatever I can every year to reduce what can go to Uncle Sam.

[Okie State 3804]

I'd mix in Roth contributions too so you're diversified once you reach retirement. You never know where tax rates will be in the future.

[Onboard 2.0 9083]

What is this word   reee-tire-ment ?  

[phdhorn 6224]

1 minute ago, Onboard 2.0 said:

What is this word   reee-tire-ment ?  

[Onboard 2.0 9083]

1 minute ago, phdhorn said:

Damn.... I was right....

[Spankytoes 1739]

12 hours ago, TexArcher said:

I'm a financial advisor and I cringe every time a client wants to refer a millennial to me.  They just don't listen.  You can show them all the graphs and projections in the world, and they will continue to put 4% into their 401k and spend the rest.  Don't even get me started on life insurance or long-term care.  They're all going to see 40 countries by age 40 and retire at 60 with $150k to last them 25 years.  No problem.

My oldest son (College Soph.) is turning 20 in December. I literally sat down with him and made a budget in Excel using his actual earnings and spending habits. As I suspected, he was spending about $200.00 more a month than what he was bringing in because he was using his debit card for small purchases and couldn't balance his budget. So I told him to go to the ATM and pull out $40.00 a week. Every time he wants to purchase something, if he has cash in his pocket, he can afford it. If he doesn't, he can't afford it. Don't use the debit card anymore. Also, just because he has money in his bank account, doesn't mean that he has money to spend. He has to prepare for unforeseen issues, like someone breaking into his car or a cutback in hours at work. 

Everything was great...for about 3 weeks. I had to text him this morning to find out why his account was getting debited by an app called Robin Hood. Turns out that he wanted to learn about stocks and $100.00 a week to test the market, when he is eating ramen noodles, seemed like the way to do it.