Washington County Weekend Post

Despite countless televi- sion ads touting the virtues of retirement planning, it seems many people are not getting the message. Accord- ing to a survey from GOB- BankingRates.com, one- third of Americans have nothing saved for retire- ment. The picture is not any rosier in Canada, where Statistics Canada reports that just 65.2 percent of the country's 14 million house- holds contributed to a retirement plan in 2015. Financial advisors rec- ommend men and women begin saving for retirement as early as possible. The longer people delay opening a retirement account, the less time their money will have to grow. Those who never open such accounts may not be able to meet their cost of living in the future. While it pays to start saving for retirement early, late bloomers who need to catch up should know that it's never too late to start. • Sign up for an e m p l o y e r - s p o n s o r e d retirement account. Many employers arrange for retirement savings accounts like a 401(k) for their employees. Such accounts are typically tax-deferred. As a result, men and women likely won't even notice the money missing from their paychecks each month. Take advantage of such offerings if they exist. Such opportu- nities can be even more ben- eficial to late bloomers whose employers match contributions up to a prede- termined percentage. • Start saving as much as possible. Many people contribute 6 percent of their pay to a retirement savings account such as a 401(k). That rule of thumb may be enough for young workers, but late bloomers may need to contribute a higher per- centage of their incomes if they hope to catch up. If 10 percent is doable, then con- tribute 10 percent, being sure to diversify how that 10 percent is invested. Workers who can afford to contribute more might want to explore other retirement account options so they avoid putting all of their eggs into one basket. • Avoid high-risk investments. Investors try- ing to catch up on retire- ment savings may be tempt- ed to invest their money in high-risk funds with the hope of making up ground quickly. But investors typi- cally want to reduce risk as they get older. That approach should still gov- ern late bloomers' investing decisions, as high-risk funds that don't perform well could leave aging investors with little to nothing come retirement. Prospective investors who need help choosing the right funds for themselves should contact a financial advisor. • Cut spending. Men and women getting a late start on retirement saving should examine their monthly expenses, looking for places to cut costs so they can reallocate those funds for retirement sav- ings. Some ways to consider- ably reduce monthly expenses include cutting the cord with a cable provider, driving a preowned vehicle instead of a new model and downsizing to a smaller home. Men and women who have delayed saving for retirement should not panic. While it's always best to begin saving for retire- ment as early as possible, there are ways for late bloomers to catch up and/or create a decent-sized nest egg for their golden years. 4 • WASHINGTON COUNTY POST • SUNDAY, APRIL 4, 2021 GMTODAY.COM Retirement saving tips for late starters Millennials include peo- ple born between 1980 and 2000. Millennials have become an influential demo- graphic, changing the way business is conducted. While influencing tech- nology, social norms and mores, millennials also are affecting the economy. Forbes says that many mil- lennials have a shaky rela- tionship with money, due in some part to the fact that they lived through one of the worst recessions the United States has experi- enced in decades. Couple that with staggering student loan debt and it's easy to see why millennials may be fac- ing an uphill battle when it comes to their finances. Millennials are falling particularly short in regard to saving money. According to a 2017 GOBankingRates survey, 57 percent of Ameri- cans have around $1,000 in savings. Sixty-seven percent of young millennials, between ages 18 and 24 have less than $1,000, says the survey. Canadians are sav- ing even less, even though in the early 1980s Canadians of most ages used to save twice as much as Americans, or 20 percent of their disposable income, according to the Bureau of Economic Analy- sis. Many millennials spend more than they earn and live above their means according to a report by American Express Business Insight. This, along with school debt, has compro- mised millennials' ability to purchase a home or even get married. Just how are millennials spending their money? Here's a look at the common patterns. • Experiences: Funding experiences is a high priori- ty for Gen Y. This includes concerts, sporting events, live performances, and other social events more so than possessions or career status, offers Forbes. • Retail goods and din- ing: TD Bank found that millennials make more retail purchases and dine out more than other genera- tions, but generally spend less money overall. • Healthcare: Millenni- als spend about $1,000 more on healthcare expenses than the generations that preced- ed them, states financial resource Mother Jones. Housing and education costs also have risen, con- tributing to a smaller pool of savings. • Same-day delivery: A Shop.org survey indicated that millennials are twice as likely as other generations to pay extra for same-day delivery of online purchas- es. • Tattoos: Surveys con- ducted for Pew Research found that 40 percent of mil- lennials have at least one tattoo. • Organic foods: A Gallup poll from the sum- mer of 2016 found 53 percent of Americans ages 18 to 29 actively try to include organic foods in their diets. • Small businesses: A new RBC® Small Business poll found 70 percent of Canadian millennials are willing to pay more for goods and services if they're sold by a small or local busi- ness. Millennials have grown up during a period of rapid change. Their large num- bers are shaping the econo- my in myriad ways. How millennials spend their money Advertising is the best way to make points with prime prospects who are ready, willing and able to buy. Call us now!

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