Most millennials understand the need to save for retirement. According to 15th annual Retirement Survey by the Transamerica Center for Retirement Studies®, two-thirds of millennials expect to self-fund their retirement through 401(k)s or like accounts because they do not expect social security to be available to them when they are older. Knowing that, the median age that millennials started saving for retirement was 22. This is great news, but are millennials saving effectively?

Tips for Retirement Savings

  • A little bit of savings can go a long way.
    • Investing $10 a day in your 401(k) for the next 30 years can grow to thousands of dollars.
    • If your workplace provides a 401(k) match, you should at least invest enough to receive the full match. This is a great way to accelerate your retirement savings.
  • Create a checklist to help plan for retirement.
    • In your 20s, you have student loans and credit card debt. Make sure you create a debt repayment plan if needed.
      • If you need support, there are plenty of repayment programs that offer some relief.
      • During these times, make sure to pay attention to your credit score so you can qualify for the best loan to make big purchases such as a house or car.
    • In your 30s and 40s, this is the time that many are planning for weddings or families.
      • This is the time to start investing the extra money you have, whether it be saving money to buy a home, saving for children’s college and other goals you may have.
      • Along with reaching these goals, you want to start to establish an estate plan, will, life insurance and other protection.
    • In your 50s, you are starting to approach retirement.
      • This is the main time to focus on paying off any outstanding debts such as a mortgage or car loan, so you are not paying this off during retirement.

Invest Now to Retire Later

When you are young, it may seem unimportant but starting to save early and getting in the habit of contributing your 401(k) is the best way to set yourself up for future success. By following the above tips, millennials will be better prepared for a fun and worry-free retirement.