Retirement Readiness: Why Gen X and Gen Y Feel Behind—and Bitter

Retirement Readiness: Why Gen X and Gen Y Feel Behind—and Bitter

You wouldn’t board a plane without knowing your destination. So why save for retirement without defining your goal?

Yet a 2013 study from market research firm Greenwald & Associates reveals that, when it comes to planning for their golden years, Generations X and Y may be headed nowhere — fast.

But that doesn't mean these people don't have retirement on the brain.

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In fact, 90% say saving up for their golden years is an important goal. However, two-thirds admit they haven’t calculated just how much they need to save for retirement—and almost half (48%) feel incredibly behind on this crucial savings goal.

Without specific goals in mind, saving for retirement can feel a lot like running a race without knowing where to find the finish line. In 100-degree weather. With scuba gear on. But it doesn’t have to be such a stressful, directionless endeavor.

2 Ways to Get on the Right Retirement Track

So how can you start taking control of your retirement savings? The key is to take it one step at a time.

“Start with what you can afford to contribute, and make sure you’re taking full advantage of your employer match, if you’re eligible—otherwise you’re leaving free money on the table,” says Brandie Farnam, CFP®, at LearnVest Planning Services. “Then gradually increase your contributions by 1% every six months. Incremental increases can have a big impact on your future—but a small impact on your budget today.”

Another option? Consider working with a financial planner. The Greenwald study finds that almost 40% of Gen Xers and Gen Yers think a financial adviser is an important source for sound money advice. They've likely caught on to the fact that a planner can help struggling savers set their goals — and then gauge whether they’re on track to meet them.

Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, CFP® (with plaque design) and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board’s initial and ongoing certification requirements.

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