25 percent of Americans are saving $0 for retirement
Millennials are the worst age group when it comes to putting money away for their golden years.
This post is a staff report from partner site CNBC.
Retirement savings for about a quarter of Americans amounts to ... $0.
One in every four Americans is not saving for retirement at all, either because they are not thinking about it, do not really know how or, worse, do not feel they can afford to, according to a report by Country Financial.
Americans ages 18-29, often called “millennials," are among the worst when it comes to saving for retirement, the firm said. Nearly a third—32 percent -- aren't saving at all for their "golden years."
Many 20-somethings might just be pulling themselves out of the swamps of student debt, or maybe they just think retirement is too far in the future to worry about.
The latter might not be the best approach, said the report. Almost half of people 40 years or older claim to regret their retirement decisions.
But there may be some deeper problems at work. Forty-six percent of those who aren't saving say they cannot do so on a middle-class income. That number has risen since 2011.
There are also knowledge gaps, though. Fifty-five percent of Americans don't know if they are participating in a 401k plan, and of the 45 percent who do, only three in 10 know how their money is being invested.
More from CNBC
You can't save what you don't have. Now expect a slew of posters stating how folks should live below their Means, etc, etc. Those Folks will push the Myth of saving for Retirement without even having a Livable Wage that makes that possible. Most Folks that can save, don't need article after article explaining what to do with it. Everyone else, they are feeling lucky just to make it to the Next Pay Check after cutting everything to the Bone. Far too many Folks living with Alice in Wonderland.
Like some other guy said in these comments, we spend too much money on things that nobody else in the world spends money on - clothes dryers, cable TV, dining out every day, dish washers, etc. etc.
Here's the path to retire on your own terms, in 7 steps:
1) Pay off your debts as fast as you possibly can. If this means living in a crappy studio apartment and eating ramen everyday for a couple of years, do it. If you want to buy a car, get a reliable beater. Get insurance for $25/month from Insurance Panda. Forget about buying a house until your debts are paid off.
2) Once you are out of debt, stay out of debt. The only exception to this rule is a vehicle and a house. If you want to get a nicer car, buy used and be able to pay it off in a year or 2.
3) If you are going to stay in the same spot for at least 10 years, buy a house, preferably with at least a little bit of usable land. An acre is good, 5 acres is better. Take the amount you are pre-approved for and cut it in half - that's how much you should spend on a house. Come to the table with at least 20% down and make a couple of extra mortgage payments every year. If you're going to be transferred or relocate every 5 years, forget about buying a house and rent instead.
4) Develop multiple revenue streams. Do contract work. Start a business on the side. Invest in a business as a silent partner. Raise chickens, breed dogs or grow apples. Build websites. Buy and sell antiques. Acquire rental property. Sell something that generates residual income. Learn to play the currency markets or trade stocks. Do whatever you can to generate income from multiple sources.
5) Grow these multiple revenue streams to the point that they generate enough consistent and reliable cash flow to replace your current income.
6) Make as much as you can. Save as much as you can. Give away as much as you can.
7) Retire!- the sooner, the better. Be sure you understand that "retirement" doesn't necessarily mean you stop working, it just means having the freedom to do what you want to do, when you want to do it.
Don't be foolish and fall into the trap of trying to measure your wealth by the value of your assets. Markets change. Valuations fluctuate. Instead, measure your wealth by the amount of cash flow your assets consistently generate.
So why do so many posters always want others to assume you have a Problem of saving and or Spending just because you realize the Global Issues of Record Wealth Creation at the same time of Record Poverty Levels. By doing so, they avoid the Real Conversation and that was their Goal from the very Beginning.
The only spending anyone is really aware of is their own. However the JOB issues and types are available to everyone. As are the Cost of Renting, Buying a Home or Car, and soaring Inflation. Most Workers haven't had a Raise in over a Decade in spite of working Harder, Longer, and being more Productive. Yet the same Fools want everyone to think it's always a YOU problem when clearly it's far more Complex then that. And it always has been.
I can imagine how it would feel to work and not save for retirement. I was there in my 20s. Just before leaving that decade, I took a serious look at the vicious cycle that essentially boiled down to allowing everyone else to pick over the carcass that was my paycheck - leaving me a rotting mess of sun scorched bones to deal with. I started very small, slowly and regularly paying myself first. Soon, I had an emergency fund (priority #1). Next was tackling debt AND retirement saving. Fast forward many years - that rather large decision to take very small steps has miraculously resulted in the real possibility of retiring early. Already debt free, yes, that means the mortgage is fully paid (and did that feel special).
It can be done - just a simple examination and change in thought process - nothing more elaborate than that. There's absolutely no one out there that will care about your senior self more than you will. It feels great to have the confidence to say - I'm doing it.
My baby boomer wife and I got an education in the mid 70's--and have a 7 figure portfolio.
See a pattern?--stupid and broke go hand in hand.
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