Millennials endure lots of shade-throwing, but it turns out they’re way ahead of their elders when it comes to prepping for retirement. According to Business Insider, millennial parents are likely to be richer in retirement than the typical Gen X-er or baby boomer with kids. They're making money choices now that are setting them up smartly for later. We spoke with Grant Sabatier, founder of Millennial Money, who explained three things millennials are doing to fortify their finances.
1. Saving More Money
First on our list is – millennials are saving more major money! “One thing millennials are getting right is they're actually saving more money than ever before,” explains Grant. “Lots of our parents are still working and haven't yet retired – so we're really taking the lesson that retirement is not guaranteed.”
Millennials are also benefiting from their employer's 401k auto-enrollment, and contributing at least 3% of their paychecks to retirement. This benefit that wasn't even around 10 years ago!
2. Making Their Money Work
Number two on our list is info you can take to the bank. Millennials are putting their savings to work, and investing where they'll see the most return. “When you save money, you typically put it in a savings account where you're maybe going to get 1 to 1.5% return per year,” informs Grant. “A lot of millennials are buying stocks, real estate, bonds – things that have the potential to grow and increase in value way more than 1 to 1.5%.” Can you say cha-ching?!
3. Spending Strategically
The final secret to millennials’ money success is spending it strategically! “[Millennials are] delaying large life decisions,” Grant shares. “We're being strategic about our choices so…One of the markers of success in previous generations was to get a job and buy a new car. But car sales amongst millennials are actually down pretty considerably.” Millennials are buying homes at slower rates, too. They've been called the “YOLO” generation – you only live once! – because they prioritize spending money on experiences over material things. Because living in a material world is so 80s.
Millennials are gettin' it right and proving the rest of us wrong!
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