Bad news for all of you millennials: saving isn’t one of your strong suits. According to a recent study done by Moody’s Analytics, the savings rate of people 35 and younger has dipped into the negative. This means that the millennials are spending more than they have. Yikes!
Despite the fact that the job market is on the rise, millennials are still having a tough time making ends meet. This could be due to the fact that wages have remained nearly the same since the 1990’s. There’s also the fact that many millennials are suffering under a boatload of student debt. Add to this a lifestyle of traveling, living in expensive cities, and spending half of their paychecks, and you’ve got a problem.
But the millennials didn’t grow up during a time when saving money or trusting your money to a bank was entirely commonplace. Take the hard-hitting recession and the Occupy Wall Street movements, for example. Events like these certainly instilled a mistrust in banks and government in millennials.
Let’s be realistic, though - saving money is hard, no matter how old you are. The precarious spend-heavy lifestyles that we lead don’t exactly help to put money away in the bank. So what to do? One way is to sign up for your company’s 401k, and be sure to contribute enough to get the company match. As you get older, be sure to calculate IRAs, Roth IRAs, and risk into your savings plans. A good goal to have is to have saved what is equal to your current salary by the time you turn 35. That will keep you on track with saving for the future.
Start saving today before it’s too late!
Source: CNN Money
