Is There a Millennial Money Problem?
This is the fourth and final post in our millennials and retirement series inspired by a September 20th issue of Barron’s. In that issue, Barron’s mentioned that only 43 percent of millennials are saving for retirement. Barron’s, also, released findings from a BNY Mellon Bank and University of Oxford’s Said Business School study. The third major finding from that study is our fourth and final topic of this series, “62 percent of millennials haven’t seen retirement products marketed to them.”
Millennials Are “Too” Young
We did our own, non-exhaustive, research and agree that there isn’t much, if any, retirement marketing targeted to millennials. We think this is the case for two reasons. The first is that even the oldest millennials are only now approaching their mid-thirties, while some still haven’t reached college age. This means a good percentage of millennials still haven’t begun full time work, if working at all, while the few who are have only been working for five to ten years.
Quite simply, as a whole, your cohort is thinking about retirement the least because you’re the furthest away from retirement. You are the generation least likely to respond to costly retirement marketing because you are most likely thinking about more near-term concerns.
From a business and marketing perspective, retirement ad dollars are better spent on the generations most concerned about and most likely to respond to retirement marketing, Baby Boomers, The Greatest Generation, Gen X and Gen Y respectively.
We know that’s not in chronological order. Most of The Greatest Generation is retired. There’s not much planning left to do. Baby Boomers are retiring and approaching retirement. Especially with the stock market downturn and housing market bust of 2008, Baby Boomers have the most work to do in the shortest time.
Millennials Are Not “Profitable”
The second reason we believe there isn’t much retirement marketing directed towards millennials is because, as a whole, you have the least amount of investable dollars. The amount of time and money spent to win the business of an older individual with more investible dollars is proportionally more rewarding to banks, investment firms and those compensated for acquiring new money for their company.
Despite the lack of marketing directed towards millennials now and in the near-term, you can start retirement planning today. You don’t have to wait to meet a bank’s ideal business development profile.
As a generation, millennials have already proven to be ingenious and independent thinkers, capable of creating whole industries out of thin air. If you can direct these characteristics towards your retirement planning, you’ll be well on your way to financial security in no time.
Millennial Resources for Today
Below is a list of resources to use to start your retirement planning. Take advantage of some or all of them. A good start is the four posts in this millennial retirement series. We’ve tried, and think we’ve succeeded, with answering the concerns uncovered by Barron’s and the BNY Mellon and University of Oxford studies.
The Debt Free Guys Millennial Retirement Series
- Why Millennials Aren’t Investing for Retirement
- What Millennials Must Know about Retirement Plans
- Tax Benefits Millennials Should Know about Retirement Plans
- The Millennials Retirement Marketing Conundrum
Millennial and Personal Finance Blogs
- The Debt Free Guys
- Chelsea Krost
- Retirement Savvy
- College Investor
- Broke Millennial
- Young Adult Money
Books for Millennials
- #MoneyConscious Financial Planning Guide: 12 Steps to a Richer You by The Debt Free Guys
- The Millennial Problem and Solution – Douglas Boneparth, CFP
- Stock Market Investing for Newbies by Money Ahoy
- The Richest Man in Babylon by George S. Clason
- Think and Grow Rich by Napoleon Hill
- Millennial Money: How Young Investors Can Build a Fortune by Patrick O’Shaughnessy
- The Ultimate Guide to Saving for Retirement: For College Graduates and Millennials by Robert Farrington
Brokerage Firms for Millennials
Combined, these are enough tools to start your retirement plan and lay the foundation for financial security. We want you to start saving and investing early. An early investor who sets aside the same amount of money annually for ten years and stops will rarely be caught by the late investor with the same rate of return who starts annually investing the same amount of money ten years later. See this example.
While we agree that there’s a void in retirement planning marketing to millennials, that doesn’t mean you must wait until there is marketing directed towards you. If you do that, you’ll start too late. Get started today. The sooner you start, the better.