Outlook Improving: 1 in 6 millennials have $100K in savings

Editor: Johnathan Meyers | Tactical Investor

1 in 6 millennials have $100K in savings

Millennials are pushing back against the stereotype that their money management skills are lacking, as 16% now have savings of $100,000 or more, double the amount of young people who had socked away that much in 2015, according to a new Bank of America survey.
Sixteen per cent say they have $100,000 or more in savings, up from 8% in 2015. And nearly half (47%) have $15,000 socked away, up from 33% in 2015.

“Despite stereotypes of Millennials as being foolish with money and not long-term planners,” they are actually behaving “quite responsibly” when it comes to money, says Andrew Plepler, global head of environmental, social and governance at Bank of America, summarizing the findings of the bank’s 2018 Better Money Habits Millennial Report released Tuesday. “They deserve more credit. Millennials are actually doing better than you — and they — might think.”
Aside from saving for an emergency, which 64% said was a “top priority,” half (49%) said saving for retirement and a third (33%) said saving to buy a house was their top savings goals. Read more

1 in 6 millennials have $100K in savings

Daniel Packer, a 29-year-old data analyst at an online advertising agency in Los Angeles, knows more responsibilities will stack up as he hits the big 3-0 this summer, so he’s been religiously stashing away money in his retirement accounts the last few years.

He’s already seeing his strategy pay off, given he has a 1-year-old daughter and raising kids is expensive (try somewhere between $284,000 and $600,000). “I’m glad I was able to take advantage of [saving] for the last nine years,” he said.

Today’s 30-year-olds (and the soon-to-be 30-year-olds) are plagued with crippling student debt, which just hit a record $1.31 trillion and affects millennials more than any generation before them.

As opposed to other accounts, like a 401(k) plan, that place penalties on individuals who withdraw money from these accounts, investors can take money out of a Roth IRA penalty-free so long as they only take out the money they invested, and not the investment earnings of those assets. Some 30-year-olds, like Packer, have numerous accounts. Read more

According to the Employee Benefits Research Institute’s 2016 Retirement Confidence Survey, 54% of workers in the U.S. have less than $25,000 in total savings and investments, outside of their home value and a rare pension plan.

With pension plans being almost extinct, saving for your own retirement is increasingly important. The government is starting to realize that if it doesn’t begin encouraging savings now, the expense of completely supporting tens of millions of retirees who have zero retirement savings will be catastrophic for the country. Now is the time for action.

I have the feeling that a good many of you are exceptions to these statistics. But why? How are most Americans not getting the message? Read more

Outlook Improving: 1 in 6 millennials have $100K in savings

1 in 6 millennials have $100K in savings

1 in 6 millennials have $100K in savings

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