Seven tips for Millennials toward achieving retirement readiness:
- Save for retirement. Start saving as early as possible – and as much as possible. Save consistently over time. Avoid taking loans and early withdrawals from retirement accounts.
- Consider retirement benefits as part of total compensation. Ask an employer for a plan if they don’t offer one.
- Participate in employer-sponsored retirement plans, if available. Take full advantage of matching employer contributions, and defer as much as possible.
- Calculate retirement savings needs, develop a retirement strategy, and write it down. Factor in living expenses, healthcare needs, government benefits and long-term care. Envision future retirement and have a backup plan in case retirement comes early due to an unforeseen circumstance.
- Get educated about retirement investing. Whether relying on the expertise of professional advisors or taking a more do-it-yourself approach, gain the knowledge to ask questions and make informed decisions. Learn about Social Security and government benefits, keeping in mind that benefits may change over time.
- Seek assistance from a professional financial advisor, if needed.
- Be proactive about staying competitive in the ever-changing job market. Be proactive about keeping job skills up-to-date, performing well on the job, staying current on employment trends and marketplace needs, and even going back to school to learn new skills if necessary.
Employers play a vital role in helping their employees plan and save for retirement. The survey found that Millennials, more than older generations, value retirement benefits and would even consider changing employers for better benefits. Employers should take note and consider offering competitive retirement benefits as well as providing education on the importance of starting early and saving consistently over time. Meaningful steps for employers include extending eligibility to join a 401(k) or similar plan to both full-time and part-time employees, as well as making it easy for employees to join and increase savings in the plan vis-à-vis automatic enrollment with an annual automatic escalation.