Posted on January 18 2019
There could have been two old people in those chairs, but those old people didn't start saving for their retirement in their 20's.
Recovering from Economic Hellfire
It's no secret that as millennials, we're kind of screwed over economically. The rate of inflation is surpassing the pay rate, the cost of living is skyrocketing, and we have insanely high amounts of school debt or otherwise. Our generation has out-populated even the Baby Boomers, and they are literally named after the fact that there were so many of them! We are everywhere, and most of us unfortunately have very little monetarily speaking. Not to mention, we entered adolescence or adulthood during the Great Recession. We witnessed friends, families, parents, even ourselves lose homes, jobs, and money. It's no wonder we're so wary of investing and cautious with credit. Caution with money is great, but right now is the most important time for millennials to be investing. It doesn't have to be scary. We can take it slowly, but we have to start now.
Say hello to my savings account.
When I first started thinking about investing, my initial thought was buying up share of stocks, watching the news all day to see if the numbers have gone up or down, and the inevitable fear of a crash and losing money! The good news that I quickly learned is that investing is much more than the stock market (we'll get into stocks more later).
Investing can be as simple as taking advantage of your company's 401K plan and setting aside the highest amount they'll match. 401Ks are awesome because the money invested into them (usually a percentage taken out of each pay check) is pre-tax, so you end up paying less taxes each paycheck and at the end of the year.
Own a small business or work for yourself? There are 401k options for you too! Would you rather have a retirement investment fund that you set up and manage yourself? Check out a Roth IRA. The amount you can invest is lower, and instead of pre-taxed money, it's tax deductible leading to lower taxes at the end of the year.
Or, you can have both! You don't necessarily have to choose. If you are just dipping your toes in, I'd suggest starting with a 401K if you have access to it.
That clipboard just says, "Business Company."
But why the heck do I need to start a retirement fund?
Me taking notes in my economics classes in college.
- The economy is terrifying, but not as terrifying as it was 9-12 years ago.
- Saving for retirement doesn't have to be difficult, and it doesn't have to be costly either!
- Save small chunks now and bigger chunks when you move up in your career, or make more money.
- When considering potential jobs, look at the benefits package. Ask whether or not they offer a 401k plan and if they will match your investments. It's all about those benefit packages y'all!
- If you want to save slower and not have money removed from every paycheck, but invest when you have some extra money, check out an IRA through established companies such as Betterment and Wealthfront.
- Cash is dandy, but investing helps your money MAKE more money!