When it comes to saving for the future, unfortunately, there’s no exact figure that would enable every single Millennial to live comfortably during his or her retirement.
BOSTON (PRESS RELEASE JET) October 31, 2017
The biggest question Millennials face when thinking about their future retirement is “am I saving enough?” It’s often difficult for Millennials to determine if they are saving enough to live off of 40 to 50 years from now. To ensure they are on the right track, national nonprofit American Consumer Credit Counseling has come up with helpful ways to ensure Millennials are saving enough for retirement.
“When it comes to saving for the future, unfortunately, there’s no exact figure that would enable every single Millennial to live comfortably during his or her retirement,” said Steve Trumble, President, and CEO of American Consumer Credit Counseling, which is based in Newton, MA. “It is important to have a target number in mind based on income, Social Security, and investments that will support your desired lifestyle and any health or other challenges that could arise throughout retirement.”
A new survey from Earnest, Amino and Ipsos found that only 31 percent of Millennials are contributing to a retirement account, such as a 401(k). Forty-six percent of these respondents admitted they would have a hard time covering their bills if their next paycheck where withheld, compared to the 54 percent who do have some savings available to them.
American Consumer Credit Counseling provides Millennials helpful guidelines to ensure a stress-free retirement.
1. Emergency fund – Millennials should make sure they have an emergency fund that can cover at least six months’ worth of income should an emergency occur. If Millennials have an emergency fund, they are less likely to dip into their retirement savings should an emergency arise such as loss of a job or an unexpected medical expense.
2. Calculate an ideal target amount of retirement savings – come retirement; Millennials should have eight to ten times their yearly pay as their nest egg.
3. 401(k) – It is important that Millennials contribute at least 6 percent of their salary to a 401(k) plan. Many employers will match up to 50 percent of the annual contribution. Millennials can contribute up to $18,000 to their 401(k) per year.
4. 15 to 20 percent of income – It is suggested that Millennials save at least 15 to 20 percent of their gross income to guarantee they can live comfortably during their years of retirement.
5. Pre-retirement income – Millennials should work towards replacing 70 to 85 percent of their pre-retirement income during retirement. This can be replaced with retirement savings, social security or any other means of retirement income.
ACCC is a 501(c)3 organization that provides free credit counseling, bankruptcy counseling, and housing counseling to consumers nationwide in need of financial literacy education and money management. For more information, contact ACCC:
- For credit counseling & Student Loan counseling, call 800-769-3571
- For bankruptcy counseling, call 866-826-6924
- For housing counseling, call 866-826-7180
- Or visit us online at http://www.ConsumerCredit.com
About American Consumer Credit Counseling
American Consumer Credit Counseling (ACCC) is a nonprofit credit counseling 501(c)(3) organization dedicated to empowering consumers to achieve financial management through credit counseling, debt management, bankruptcy counseling, housing counseling, student loan counseling and financial education concerning debt solutions. To help consumers reach their goal of debt relief, ACCC provides a range of free consumer personal finance resources on a variety of topics including budgeting, credit and debt management, student loan assistance, youth and money, homeownership, identity theft, senior living, and retirement. Consumers can use ACCC’s worksheets, videos, calculators, and blog articles to make the best possible decisions regarding their financial future. ACCC holds an A+ rating with the Better Business Bureau and is a member of the National Foundation for Credit Counseling® (NFCC®). For more information or to access free financial education resources, log on to ConsumerCredit.com or visit http://www.consumercredit.com/financial-education.aspx
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