A recent article by Alessandra Malito shows that Millennials are running behind on saving for retirement. Not everyone is saving for retirement, they are either living paycheck to paycheck or have no job at all. Many others are not taking advantage of IRAs or other retirement savings accounts. So, this made us ask the question, is it harder for Millennials to save for retirement than it was for Baby-Boomers?
What Advantages did Baby Boomers have?
Boomers had the advantage of growing up in one of the best economies in history and had low tuition costs while in College. How inexpensive was an education? In 1965-66 the average for a four year school was only $1,375. Baby Boomers were able to save more money with tuition and had a great job market to go into after school!
What Disadvantages did Baby Boomers have?
Baby Boomers are at risk for being considered poor or near poorer than in the last 40 years because of the economy changes. They also did not have the access that we do when it comes to saving for retirement planning and saving options. 401(k)s have only been around since the 1980’s. One can only imagine how much Baby Boomers could have saved on taxes and in wise investments if they had been in existence since they entered the workforce. Baby Boomers also didn’t have access to the tools and information that is now available today. Whether banking directly on their phone, online trading, or financial research. In short, Baby Boomers did not have the technology available to research, monitor, and contribute as quickly and easily as we do so today.
The Millennial Advantages!
Studies show that since the baby boomer’s time, tuition has increased by more than 150 percent! This has made college nearly impossible for today's millennials to go without incurring huge debt. However, Millennials can qualify for more grants, loans and other saving options than ever before. Some grants are as simple as living in the same state as the school you attend! Baby Boomers may have had the better cost of tuition overall but Millennials have help for books and other supplies through direct loans, scholarships, and grants. With programs like that to help Millennials they will be less in debt as they get older and will not have as many issues saving for retirement. Lastly, with the growth of online learning, there are many more ways to learn a trade or skill, though it may not include a diploma.
How Have Millennials Had It Harder?
The fact is that Millennials have had it tough. The economy was the worst it has ever been since The Great Depression when they entered the workforce, the cost of living and real estate has gone through the roof. So, while Millennials have many great options and tools for saving, there isn’t much money to save! Having the technology at your fingers isn’t much help if you have no extra money to save. Therefore, the Millennials savings will suffer saving for retirement as the Boomers did - due to different causes, but a similar outcome. Further, with the workforce waiting longer to retire, Millennials are having to wait for management and executive level positions to open up (find avg retirement age from 1975 vs 2015). Technology is also becoming a competitor for many jobs. A.I. and Bots are quickly becoming a customer service and administrative answer for many companies. It's definitely an unknown future for the Millennials' job market!
What do you think? Who has it harder and why?? Feel free to Share!