A lot of research says that we won’t be able to retire until we are at least 70 years old, and some of us won’t be able to retire at all. To ensure their future financial security, young people must begin saving for retirement as soon as possible.
Note: I recently covered how Millennials are redefining retirement on the Millennial Money Minutes podcast. You can watch the episode below. Don’t forget to watch the new episode!
Massive student debt and historically low wages don’t paint a nice picture for our future potential and retirement hopes. If we don’t take action now, we will be doomed to repeat the mistakes of the past. Even though we won’t have enough money to retire, it doesn’t take into account how driven and entrepreneurial we are. We can always find a way to make more money. We might be both the most educated and underemployed generation in history, but as Millennials we are natural-born hustlers.
Millennial Retirement = Financial Freedom
The idea of retirement is being redefined and instead of checking out to a life of leisure, will increasingly mean having more time and space for the things you love.
A friend of mine works as a commodities trader during the day and then drives to work for 15 hours on Saturdays so he can bank the extra money. He says he uses the extra money to save for his dream of traveling around the world. The dude makes $120K in his full-time job and then tells me he will make another $30K just driving for the ride-sharing service at peak times. He said he didn’t have to sacrifice much of his free time.
He is putting all of that money into an investment account so he can leave his job in 5 years and move to Thailand. He is researching affordable places to rent in Thailand so that he can spend his retirement years in the comfort and beauty of Southeast Asia.
He got to meet a lot of new people and even met his girlfriend after giving her a lift. Sometimes life’s greatest gifts come in unexpected packages. Straight hustling is what that is. It’s a sign of dedication to your craft. There are many stories like this. Most of us want to live our lives on our own terms. This is what retirement will mean for Millennials – freedom.
One thing is for certain – retirement for us is going to look a lot different than it does for our parents.
With the hope that they will be able to stop working at age 62+, our parents have had to work their whole lives and save as much money as possible. They wanted to be able to enjoy their retirement years and pass on some of their hard-earned wealth to their children.
They will be able to take social security, as well as live off their 401Ks, at that time. Retirement is often seen as a well-deserved reward for years of hard work; it’s when people can finally enjoy the fruits of their labor. Our parent has a retirement plan. We hope that it will give them a comfortable retirement.
Most of us aren’t likely going to work towards a magic day in the future when we can golf every day and drink martinis on the beach until we die. We can create a lifestyle that will allow us to have more days to relax and enjoy life.
Why would I want to disengage for the rest of my life? It is possible to find balance and joy in your life without completely shutting out the outside world. Lower stress? I would take lower stress, but I would still like to work on projects. I enjoy the challenge that comes with taking on projects, so I’m not looking for total relaxation. I don’t think that would ever happen. How many rounds of golf can someone play? The golfer has to dedicate a lot of time to the game.
Saving is an opportunity, not a sacrifice
So right now most of us are straight hustling or you should be – we are putting in the work required to start saving and start investing money so we don’t have to work for someone else for the rest of our lives. I currently work 70 hour work weeks in my corporate job and I am saving as much money as possible so that I can have enough money to choose what I do every day. When I can say goodbye to my corporate job and focus on creating a life of financial independence and freedom, I will be happy.
I want to be able to wake up and play the guitar. I would like to practice so that I could get better at it. Someday, we will have enough money to do whatever we want, but we won’t need to work if we don’t.
We aren’t likely to have some sail off into the sunset retirement, but we are more likely to take “mini-retirements” and have a more entrepreneurial focus in our future. It’s important to stay flexible and open-minded as the future is unpredictable and full of possibilities, regardless of our retirement strategy.
For some of us those projects will be built on the skills we have learned throughout our careers and applying them through consulting engagements, or taking some of the money we have saved and investing it into a passion project or business. Others may turn to side hustles to increase their income potential.
One of my friends works in real estate and has a dream of one day owning a flower shop in retirement. She has been researching and planning how to open the shop for a long time. It is likely that it will take some solid planning to get it off the ground and sustain her for the rest of her life. She is determined to make her dream come true and has already taken the necessary steps to create a successful plan.
In the future, most of us will continue to work hard to find side projects to make money or launch second or even third careers. There are endless opportunities for creativity and entrepreneurship. The rise of the mobile economy and the accessibility of information will allow us to work on our own terms. More people will have the freedom to choose how and when to work because of this.
It is clear that the economy and entire world are moving towards an open online workforce where the flexibility of lifestyle and location will be possible for an increasingly larger group of people. It is important for us to stay informed of the latest technological developments so that we can be better prepared for a changing world.
Work is healthy, but doing work you love is important
Most of us will be able to pick up projects online and contribute to the sharing economy. These projects can be used to supplement income and help make ends meet in the current challenging economic environment. We will likely not retire, but instead build our own businesses and fit our work into our own lifestyle. With the ability to build our own businesses, we will be able to determine our own work-life balance, allowing us to better enjoy life and pursue our passions.
Our health is dependent on work. Taking breaks throughout the day can help improve job performance. It’s statistically proven that as we get older we are happier and healthier when we stay engaged with some form of work. Slowing down as you age is necessary but not necessary for your health. It’s important to find ways to stay active and engaged in life during retirement because inactivity can lead to physical and mental decline. While we might not have as much saved for retirement as we should, we have a lot going for us. Our financial futures can be impacted by the new technologies and opportunities that are available to us.
Many of my friends have taken up learning to code or studying to become certified in something or other in order to keep growing and developing their skills. With the ever-changing job market, it’s important for us to stay ahead of the curve and invest in our knowledge and abilities. I feel like half of the women I know are yoga teachers.
Even myself – I enjoy building websites and investing so much that I want to study to become a financial planner. I want to help people understand their financial options, so becoming a certified financial planner is the perfect way to do that.
Will young people be able to retire? Time will tell if young people will have to work longer to make up for lost time, or if they will be able to retire at the same age as their parents and grandparents. It will be better than our parent’s retirement because it will be on our own terms. We can shape our retirement in ways that our parents couldn’t have imagined.
We don’t have fat bank accounts, trust funds, or even decent-paying jobs yet, but what we do have is hustle and that’s what it’s gonna take. We can make it happen if we stay focused and determined. Unless of course we all get replaced by machines.