From Our Blog:


4 Reasons why Millennials are the New Face of the Retirement Crisis

Recently #millennialretirementplans was trending on Twitter. The “retirement plans” that were mentioned were not your typical blend of Social Security and retirement plan assets. The “plans” were much more dismal, with major concerns over healthcare costs, Social Security running out, lack of savings, and climate change.

The fact is, millennials – those born between 1981 and 1996 – are the new face of the retirement crisis.

Researchers with the Social Science Research Network recently published their findings about the situation millennials will likely face when they begin to retire around 2050. Researchers revealed one distinct advantage that millennials have: they are more educated than any previous generation, which should translate into higher earning potential. The rest of their findings can be classified into four “disadvantages.”

1. Student Debt Debacle

Since this generation is more educated than previous generations, it is no surprise that 42% of millennials have student debt. Of those millennials, 79% say their student loans have a moderate or significant impact on their ability to meet other financial goals.

2. Saving Struggles

Millennials between the ages of 25-35 today have a median net worth about 40% less than the same age group in 2001. That is a huge decline.

With the emergence of the “gig economy,” companies contract with independent workers for short-term engagements ie. Uber drivers, millennials will be employed in contingent jobs to a greater extent than prior generations. These jobs rarely provide access to employer sponsored retirement plans. Additionally, millennials feel like they need to be settled and check the boxes of buying a home and raising a family before thinking about saving for retirement.

3. Credit Card Crisis

Millennials tend to lean on credit cards to help make ends meet, with 30% of them using credit cards to pay for monthly necessities. The 40% of those who regularly carry balances find it difficult to make the minimum monthly payments.

4. Not–So Secure Social Security

The Social Security and Medicare funding shortfall is a topic that has been discussed at length and millennials will inevitably feel the financial burden of whatever the government decides to do about it.

What Can You Do?

Save. Save. Save.

If your company offers a 401(k) plan, be sure you are contributing. The small contributions you make now will have a huge impact down the road. If your company doesn’t offer a 401(k), consider opening a Roth IRA or Traditional IRA. Both have their advantages and disadvantages. To learn about the differences between 401(k) plans, Roth IRAs and Traditional IRAs, check out this post.

Receive your Financial Planning Workbook today!

Investor Education
Brooke Peterson

CARES Act Reminder: RMD Rollbacks

The CARES Act was passed back in late March to provide economic relief during the Coronavirus pandemic. An important piece of the initial legislation was the waiver of required minimum distributions (RMD) for 2020. The initial legislation did not include relief for those who had already taken a portion or the full RMD prior to […]

Read More »
Investment Strategy
Ryan Baldwin

The Fed’s Pandemic Promise

Though we are still in the midst of the COVID-19 pandemic, financial markets are now in a much different place than they were just three months ago. After one of the sharpest declines in U.S. stock market history, the S&P 500 rallied in the second quarter. As states began to reopen […]

Read More »
Investor Education
Steven Hannigan

What You Can do with that 529 Refund

As Coronavirus spread through the United States, what should have been the spring semester for college students was suddenly upended. In many cases students were told to pack up and leave as campuses were closed, and in nearly every college, classes were either canceled or moved online. The world really turned upside […]

Read More »

1801 Porter Street, Suite 500
Baltimore, MD 21230

3877 Fairfax Ridge Road, Suite 200N
Fairfax, VA 22030

Copyright © 2020 GGM Wealth Advisors. All Rights Reserved.

Legal Disclosures | Privacy Policy | Careers