Saving for the future should always be a priority, especially if you don’t want to spend your golden years slaving away. Unfortunately, the up-and-coming generation coined “the Millennials” is struggling to put money away.

This financial crisis certainly hasn’t gone unnoticed, as the millennials are a constant topic in financial and economical discussions. Between inconsistent saving habits, the great recession, and crippling debt, young people are more worried about their checking accounts than their retirement savings.

Considering their difficulties, here are five reasons why millennials are more conservative about saving their money.


5. Recession Apprehension


Most millennials were getting ready to head into the working world during the economic collapse of 2007. With the financial collapse in mind, many millennials who can put money aside are simply saving and not investing. After the stocks dropped and the economy crashed, there was nothing left for the next generation ready to hit the working world.

Rather than relying on programs and pensions, which are becoming less reliable, they are taking personal control over their savings. They are aiming for savings accounts over retirement savings. Additionally, there has been a drop in pensions and social security funding. With so much uncertainty, young people are focusing more on personal savings.


4. Crushing Debt


Between student loans, credit cards, and private loans, millennials are struggling under a mountain of debt. The cost of college has risen exponentially since the Baby Boomers’ Era and it continues to go up. Many young people start off in debt, and doing so has them at a huge disadvantage. Without a promising job right out of college, saving money for retirement can be a struggle.

Millennials are making the choice to pay off the debt faster or to put away money and pay longer. Unfortunately, the days of a job offer right out of college are long gone. Young people are having greater difficulty landing a job that pays enough to combat their college debt.


3. Lower Wages


In addition to overwhelming debt and stepping into an economic crisis, millennials are facing low wages making it impossible to dig out of the pit. Many young people are having difficulty finding a job in their field or are forced to take on unpaid internships to build up experience.

Of course, regardless of how young people make a living, daily expenses must be paid. Therein lies another problem. The cost of living has increased, but wages remain the same. It is difficult to balance paying off debts, daily living expenses, and savings on a meager salary. Opening a retirement account may not be achievable.



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2. Putting Life on Hold


Millennials are faced with a hard choice when it comes to saving for retirement. They must decide where their hard-earned money goes. Most money usually ends up going to cover debts or cost of living. With the remaining amount, millennials are faced with a choice to use their funds for now or save them for retirement.

Should we pay back the loans quicker or put money aside to purchase a home? Can we start a family, or should we start saving for retirement? Young people are forced to take a hard look at their personal finances to decide if they could afford retirement savings.


1. Cost of Living Expenses

All things considered, with lower wages, debt, and an unforgiving economy, it has been difficult for the current generation to save. Considering everything millennials must factor in, the final nail in the coffin is the everyday living expenses

Whether they are living in the city where the cost of living is higher, or in less populated area with lower wages and fewer jobs, many are scraping by. Living paycheck to paycheck makes it difficult to get by daily, much less saving for the future.


How Can Millennials Start Saving?


While there are many legitimate reasons millennials are struggling to save for retirement, the fact of the matter is that the traditional ways of saving for retirement are no longer applicable.

The saying goes, “half of your salary by 30.” Unfortunately, that goal isn’t realistic for many struggling to get by. Of course, we must be held accountable for our spending habits as well. There are ways to save even as we deal with daily difficulties.


Small Money Saving Tips


If you work for a company that offers a 401K plan, take advantage of it! Factor in a small contribution from each paycheck just to get the ball rolling. Additionally, with an automatic allocation, you won’t be tempted to skip contributions.

Cut back on some small spending habits. Make coffee at home, eat out less, or have a tighter grip on your click-happy Amazon finger. Using an app like Mint can help you watch your spending, so you can see where your money really goes monthly.

Create a budget plan or goal. If you are aiming for a goal, no matter how small, it may give you something to strive for. You don’t have to have “half your salary” saved up by the time you’re 30 to start. Try for $1000 in your savings account in six months. Every little bit counts.

Regardless of where we are in the life, the future should always be a part of the conversation. As we grow and life changes, we need to be ready for any curve balls that are thrown at us and finances are no different. As we aim to fix the system, it is important that we all our part to prepare for a brighter future one dime at a time.