Millennials currently are the largest generation in the U.S. workforce. Millennials differ from other generational groups both in their lifestyle and their attitude toward economic and social responsibility. They value their family. Forty percent of millennials with children hold a graduate degree, and close to 70 percent of those with children earn more than the national median income of $59,000 a year.
Millennials share a positive outlook on their future, as over a third feel that their financial situation has improved over the last five years. They bring a diverse mindset when it comes to employment and retirement, where 43 percent of millennials expect to retire before the age of 65.
But can they pull it off? What new strategies have gained good standing with economists that suggest that this generation can achieve this ambitious goal, and why do so many believe it is possible?
Millennials are determined to retire early in part by the knowledge that they can control their investments, and they believe they are up to that challenge.
In short, millennials are challenging conventional strategies and approaches when it comes to almost everything. This includes investment strategies and long-held axioms that retirement comes when Social Security becomes available.
Perhaps one of the reasons millennials feel that early retirement is possible is their emersion in the belief that a renewed plan for a Great Society is possible (and that theirs will be the generation to finally achieve its promises). Not only has this generation seen the rise of a global commitment to social change, but they have also been immersed in a workforce that has seen steady unprecedented growth, beginning in 1993 continuing to 2008. Following the 2009 meltdown of many of our leading financial institutions, government intervention and manipulation created an unusually quick turnaround period featuring massive stock growth over the past ten years.
However, many factors are working against them.
According to the Pew Research Center, 15 percent of 25- to 35-year-old millennials live with their parents. Among college graduates in this age group, 10 percent live in their parents’ homes, and many millennials need financial help from their parents, as they search for jobs and make student loan payments.
There is also historical precedent to suggest that a long-awaited period of correction is overdue. This economic climate is one that is foreign to millennials and may be a contributing factor to their belief that growth is inevitable and sustainable at current rates without accounting for market fluctuation.
Market research must also play a large part in formulating any financial plan. Having solid research behind any decision provides an advantage.
Still, basic common-sense investment practices apply:
Proverbs reminds us over and over to seek advice and listen to counsel. “A wise man listens to advice” (12:15), “ in an abundance of counselors there is safety” (11:14), and “Listen to advice and accept instruction, that you may gain wisdom in the future” (19:20). Surround yourself with those who have walked this journey before and can offer prudent, wise guidance.
Remember that statistical information can prove unreliable and costly.
According to a Time magazine cover story in 2011, those with bachelor’s degrees had an unemployment rate of about 5.1 percent, compared with high school graduates with no college, whose unemployment rate was at 10 percent. The writer also forecast shares of new jobs for those with a bachelor’s degree were about 37.6 percent, as compared with 10.2 percent for those with just an associate degree. This indicated that a solid career plan was heading in the right direction, and that by now, those who invested in a four-year education would be prime candidates for close to 50 percent of all new jobs created in 2019-2020. However, this did not turn out to be the case, and the current job market indicates that those who invested in a trade education are the ones who are prospering in today’s economy, while many who went into debt to graduate with a traditional four-year bachelor’s degree are now part of the student debt bubble.
Planning for an early retirement based upon the latest trending information is risky, and it is the tried and true long-term investments which will most likely reap the most benefits. To achieve this, building a team that can provide vetted resources and trusted advice in areas that are not your areas of expertise. Ambassador Advisors is here for you at every step of your financial journey.
3 Life Events That Require Family Financial Planning …. https://www.discover.com/online-banking/banking-topics/3-life-events-family-financial-planning/
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