Millennials get a bad rap for being self-serving, lazy, and flighty, especially among the age group that tends to read the Retirement Answer Man blog.
While that statement is a bunch of stereotypes balled into one sentence, I’ll run with the generalities for now.
There has been a demographic mindset shift in the past 15 or 20 years.
No one knew what “SaaS” (software as a service) meant more than a few years ago. Nor would people have been likely to respond to subscription-based software. (What? I don’t own my software if I don’t keep paying?)
Heck, millennials are even paying subscriptions to have access to cars they don’t own.
Who would have dreamed of that from the generation that thought owning an unsafe, unreliable 1972 Karmann Ghia was the best thing in the world during high school?
Save now. Lifestyle later.
The generations you and I come from have a preoccupation with saving for retirement. For having a nest-egg large enough to support yourselves down to your grave.
For security in the future.
And we sometimes trade our present for that.
We make sacrifices in the name of a better retirement. A more secure future.
That was bred into us from an early age, and we convince ourselves that the following generations should have the same mindset.
Heck, the generations before us thought we were crazy for not sticking to the same job until we retire and get a pension and a gold watch in return.
My point? Things change.
Save now. Lifestyle now.
Millennials see things differently. They save. But they do it with different goals in mind, on the whole.
In a recent report, CNBC showed that millennials don’t really plan on retirement as you and I understand it.
Only 37 percent of millennials said they are saving to leave the workforce. By comparison, 55 percent of baby boomers and Gen Xers are saving to quit working.
But this doesn’t mean that millennials aren’t saving. In fact, millennials are saving more than any other age group.
But not so they can quit working.
Here’s what’s happening: millennials are saving to live their desired lifestyle now. Not for some mythical future date that may never come.
They aren’t painting their retirement by numbers. They aren’t even painting a retirement picture. They’re living it.
You heard the term, YOLO? You only live once?
That’s what millennials are driving to do. To live the life they want with the only life they have.
Or, as the study put it, “Millennials are the first generation to plan long-term for financial freedom instead of retirement.”
Of millennials, 63 percent say they are saving to live their desired lifestyle. Comparatively, only 45 percent of both General Xers and baby boomers say the same thing.
While I disagree with Millennials’ propensity to forget about retirement, I think they’re nailing it when it comes to making the most of life in regards to money.
“Young adults tell us they are willing to do whatever it takes to achieve freedom and flexibility, even if it means working for the rest of their lives,” the head of Merrill Edge that ran the study said.
To me, that doesn’t sound all that bad.
But maybe that’s just because I can’t imagine myself retiring from a calling to help people reimagine retirement.
Lifestyle now. Retirement later.
What if you could have both a life you want to live now and when you retire?
That’s what millennials are doing right—focusing on a life they want now rather than at a future date.
That’s what I promote to my clients. An Agile Retirement Management (ARM) solution that allows you to be intentional about your life, your savings, your spending, and your happiness: both now and in the future.
You could be spending too much before retirement. Or maybe you’re just spending money on things that don’t matter.
Whatever your situation, I can walk life beside you and help you find a balance between your now and your later.
As a financial planner, that’s what I most want to see for you—a life you’re happy to live—no matter what stage of life you’re in.
Question of the week:
When have retirement savings gotten in the way of living a more fulfilling life for you?