The pandemic has brought about big changes for many Americans. Surprisingly, some of the financial changes resulting from COVID-19 have actually been positive.
In fact, a recent AIG survey titled Moving forward: Planning for the future in changing times showed that a generation today is much more optimistic about their retirement prospects than in the past. And you might be surprised to find out which demographic has changed their outlook for the better.
These Americans are now much more positive about their retirement prospects
According to the AIG study, millennials are the Americans who have experienced the greatest positive change in their outlook on retirement. A whopping 45% of millennial survey respondents said they now had a more positive view of their post-pandemic retirement prospects, compared to just 26% of millennials and 13% of babies. boomers.
People also read…
This may come as a surprise, as members of this generation faced unprecedented financial challenges. These have included record student loan debt, a great recession as they grew into adults and entered the workforce, and slower economic growth while in the workforce than members of previous generations.
Millennials’ optimism is not misplaced, however. AIG data also reveals that 53% of millennials have been able to increase their savings rate in recent years, with 48% seeing an increase in their savings and assets. Just over 4 in 10 millennials also saw their household employment income increase, while 39% saw their level of non-mortgage debt decrease.
Members of every generation can improve their retirement prospects in a few simple steps
While it’s great news that so many millennials have seen their financial situation improve and now have a more positive outlook on life in retirement, the reality is that everyone should be able to look forward to this time in their life. . The key to being excited about retirement is understanding what you need to prepare for financially and taking proactive steps to ensure you have the necessary funds. That implies:
- Detailed setting retirement savings goals. Take the time to determine how much money you will need as a retiree. There are several approaches to achieve this, including assuming that you will need around 10 times your final salary. Then break down your big goal into smaller goals by calculating the amount you need to save each month. Calculators on Investor.gov can help.
- Automation of your savings efforts. The best way to ensure you reach your retirement goals is to set up automatic transfers so that the investment is effortless on your part. If you know you need to invest $500 a month, have the money taken from your paycheck to go into your 401(k) or have the funds transferred to your IRA or other tax-efficient account on payday.
If you automate your savings efforts and consistently reach your investment goals, you should be able to face retirement with the confidence that comes from knowing you’ll have the funds to support yourself after the checks run out. of pay. Whether you’re a millennial or belong to a different demographic, you deserve to expect a life without financial worries in your later years, so it’s worth it.
The $18,984 Social Security premium that most retirees completely overlook
If you’re like most Americans, you’re a few years (or more) behind on your retirement savings. But a handful of little-known “Social Security secrets” could help boost your retirement income. For example: an easy trick could earn you up to $18,984 more…every year! Once you learn how to maximize your Social Security benefits, we believe you can retire confidently with the peace of mind we all seek. Just click here to find out how to learn more about these strategies.
The Motley Fool has a disclosure policy.