How Younger Generations Expect to Retire; Avoiding Spending Hangovers When You Make Bad Financial Decisions and the 3 Most Common Investing Mistakes.
How Younger Generations Expect to Retire, Where Their Income Will Come From
Millennials and Generation Z may face a unique challenge as they grow older, considering they have reason to believe that Social Security might not be fully available by the time they retire.
A new online poll from the Longevity Project and Morning Consult surveyed 2,200 U.S. adults in December about how long they expect to live.
The results solidly concluded that members of Gen Z, 70% of them, except that they’ll live longer than their parents. However, 58% confessed that they’re not saving enough for retirement, and 50% feel totally unprepared.
The solution? They hope
that 401(k) and 403(b) retirement savings plans and personal savings and investments will be enough to balance any Social Security shortcomings.
Avoiding Spending Hangovers When You Make Bad Financial Decisions
In this modern age of social media, there is one subject that keeps coming up among some of the most popular YouTube bloggers. The biggest money mistake they regret is not doing enough research and splurging on purchases that they didn’t really need.
How can you combat making similar purchases yourself? Here is the best piece of advice we can offer you:
Try to form and test drive new habits.
For example, if you’ve been eyeballing a fancy new lunchbox, try to get into the habit of actually packing lunches for a while before making such a purchase. The same goes for gym memberships. Before splurging at a more expensive option, try to see if you can handle a similar schedule at a cheaper gym first.
If you can’t seem to get into the groove, at least you’ll have the satisfaction of knowing you didn’t waste your money on a whim.
3 Most Common Investing Mistakes Millennials Should Be Aware Of
If you’re new to investing, you might be terrified about what you’re potentially getting yourself into. After all, investing can certainly be scary, considering you might be putting your finances at risk.
Before you take the first steps toward investment, here are the top 6 most common investing mistakes that financial newbies tend to make:
They Don’t Start Early Enough
—if you start early, you can take advantage of compounding interest. Mike Loewengart, vice president of investment strategy at E-Trade, offered the following insight
“Compounding is a simple way of saying that interest is building on interest. That long runway is such a powerful advantage. You have to first grasp the concept that these companies are looking to grow their revenues and profits over time.”
They Ignore Fees and the Fact that Your 401(k) is NOT Free
—you might think that your employer is helping you to save toward your retirement, but you should realize that this isn’t a freebie
Douglas Boneparth, founder and president of Bone Fide Wealth in New York said, “Fees can include the costs of buying and selling investments, owning investments, and whether or not someone is helping you manage your investments.”
For example, if you carry a balance of $103,700, you could be paying as much as $467 a year
in fees toward these costs.
They’re Too Conservative
—when people shy away from equities, that means you’ll have less to spend thanks to your money not outpacing inflation. Loewengart said about this topic, “When you are diversified, you reduce the single-company risk that many people feel can hold them back from investing in equities.”
In other words, the very best thing you can do if you’re new to investment is to simply take the time to research strategies and to take the right steps from the very beginning.
A little bit of prep can go a long way towards achieving your future financial goals.