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Young people should put down their smartphones, step away from the avocado toast, and do this
MARKETWATCH 10:49 AM ET 5/25/2017
Trust us: Your 'old self' will thank you

Millennials, here's one way to avoid a regret that's plagued people for generations: Start saving for retirement immediately.

Nearly 3 out of 4 adults have financial regrets, with not saving enough for retirement sitting at the top of that gloomy list at 22%, according to a recent Bankrate survey (http://www.bankrate.com/banking/savings/financial-security- 0517/).

"The risk for retirement savings has shifted from enterprises and the government to Americans themselves," says Mark Hamrick, senior economic analyst for Bankrate. "No matter what stage life people are in they can probably benefit from trying to save some money, especially those in the early stages of their working life."

Employer-sponsored 401(k) accounts are the best way to get started -- the contributions are automatically withdrawn from pre-tax earnings and companies typically offer a match, which adds up. Other options are Roth IRA or traditional IRA accounts (http://www.marketwatch.com/story/roth-or-traditional-ira-for-max-contributors-its-no-contest-2017-03-15). (Note: There are income limits (https://www.irs.gov/retirement-plans/amount-of-roth-ira-contributions-that-you-can- make-for-2017)for Roth IRAs.)

Read: Everything recent college grads need to know about planning for retirement (http://www.marketwatch.com/story/ yes-recent-college-grads-need-to-start-planning-for-retirement-heres-a-guide-2017-05-16)

It's not always easy. Many young people are trying to stretch early career salaries across heavy debt burdens from college, high rents and living expenses. But there are probably some things that can be redirected into savings. Whether it's changing habits at the grocery store, doing an audit of data subscriptions, or cutting back on mindless meals or coffee out.

Read: This is how your finances should look in your 20s (http://www.marketwatch.com/story/money-milestones-this-is- how-your-finances-should-look-in-your-late-20s-2017-05-16)

The earlier you start saving, the better off you will be. Anxiety and dread about retirement savings get worse as people age. So while retirement may be the last thing on the minds of millennials and recent college graduates, this is precisely the time to get started and make a habit of putting money away for those (hopefully) golden years. Baby boomers -- many of whom are either retired or nearing retirement -- are the most likely to regret not saving for retirement earlier.

Read: Why baby boomers are divorcing at a stunning rate (http://www.marketwatch.com/story/your-failing-marriage-is- about-to-make-the-retirement-crisis-worse-2017-03-13)

The survey results come at a time when baby boomers (those aged 53 to 71 for the purposes of Bankrate's data) are retiring at a rate of about 10,000 a day and are facing greater longevity (http://www.marketwatch.com/story/your- retirement-may-not-be-so-horrible-after-all-2017-02-23), which means they need to save even more for a longer life in old age.

"Whatever age someone thinks they might be retiring, I'd urge them to continue to work as long as they're inclined or can," says Hamrick. "Continuing to have some kind of income can make a big difference."

Read: Americans are drastically undersaved for retirement (http://www.marketwatch.com/story/the-amount-of-americans- not-saving-for-retirement-is-even-worse-than-you-thought-2017-02-21)

Baby boomers should dial up on the risk spectrum in their investments, he suggests. "If they are 'lucky,' at the age of 55 they could easily live another 30 to 35 years."

Among the other regrets mentioned by survey respondents are not having enough emergency savings and either not saving enough for college, or taking on too much student loan debt.

Read: Half of Americans are living paycheck to paycheck (http://www.marketwatch.com/story/half-of-americans-are- desperately-living-paycheck-to-paycheck-2017-04-04)

"Parents can benefit from saving for college as early as possible. You have a time horizon of 18 years and 9 months," says Hamrick. "The cost of a college education has been increasing far faster than inflation. There's also the question of trying to find the greatest value in the college selection process and taking advantage of community colleges and technical school."

Read: What's more expensive than a college education? Not having one (http://www.marketwatch.com/story/workers-are- more-likely-to-be-college-educated-for-the-first-time-ever-2016-06-30)

Hamrick encourages people of all ages, but especially those starting out, to invest time in making a budget, planning for their financial lives and seeking out low-cost financial advice.

"Something this important isn't something you can just guess at."

-Angela Moore; 415-439-6400; [e-mail]

RELATED: What do we owe our parents in old age? This millennial asked the internet (http://www.marketwatch.com/story/ this-millennial-wants-to-help-her-parents-save-for-retirement-2017-03-14)

RELATED: The U.S. college system is broken, millennials say (http://www.marketwatch.com/story/the-us-college-system- no-longer-works-millennials-say-2017-05-12)

RELATED: When they're not eating avocado toast, millennials spend five hours a day doing this (http:// www.marketwatch.com/story/when-theyre-not-eating-avocado-toast-millennials-spend-five-hours-a-day-doing-this-2017-05-18)


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05-25-171049ET
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