It turns out there is a downside to spending 120% of your annual income every year from the time you graduate college until that day you turn 40 and finally realize that you’re getting old and have absolutely no liquid assets and no hopes of ever retiring. While the above strategy seemingly makes sense to our elitist, Ivy League-educated central planners at the Fed who have waged a nearly decade-long war on saving (because how can we have economic growth if people aren’t willing to lever their income 5x and spend every dollar they make?), the roughly 19% of Americans who are over the age of 65 and are still forced to work are probably wishing they could go back and do things slightly differently.
As Bloomberg points out, the percentage of 65 years olds working in the U.S. today is higher than at any point going back to at least 1965.
Unfortunately, this looks to be a record that millennials are destined to beat. As we recently pointed out (see “Most Millennials Have Less Than $1,000 In Savings, Live Paycheck-to-Paycheck“), the majority of millennials are living paycheck to paycheck.
A recent survey of millennials by HowMuch.net found that 51.8% of those aged 18-34 have less than $1,000 held between bank accounts and cash savings.
As Visual Capitalist’s Jeff Desjardins notes, this echoes previous data we’ve seen – not just on millennials, but Americans in general. For example, we know that 14% of Americans have “negative” wealth. We also know that 62% of Americans don’t have emergency savings that could cover a $1,000 hospital visit or a $500 car repair.
Taking that into consideration, here’s a deeper dive into the more recent millennial data…
Meanwhile, as a testament to their strong work ethic, a study by ManpowerGroup recently found that roughly 30% of millennials envisioned taking an “extended break” from work at some point in their careers to “relax/travel/vacation” while another ~20% said they’d take a break to “pursue a life dream or hobby.” Sure, why not? If everything goes horribly wrong then taxpayers will be waiting to payoff your student loans for you…so no worries.
And, unless you thought this was just a phenomenon limited to America’s snowflakes, turns out millennials all over the world have very little confidence in their ability to save.
Well, at least we’re not alone…misery loves company as they say.