How millennials can maximize savings for retirement

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How millennials can maximize savings for retirement
Millennials can secure their retirement if they start saving at least 10% of their income in a tax-advantaged 401(k) plan, according to this article on The Wall Street Journal. They should also sock away at least 5% of their earnings in an emergency fund to avoid tapping their retirement savings to cover contingency costs. While building their nest egg, millennials should start paying down student loan debt. They should refinance their debt, reduce spending and get a side hustle to earn extra money to pay the debt.

Opinion: How well do household surveys measure retirement income?
A study has found that of the five commonly used national surveys about retirement income, only the Census Bureau’s Current Population Survey provides a data set that underreports income from all sources, writes Alicia H. Munnell, director of Boston College Center for Retirement Research. "The findings suggest that the most commonly used surveys — such as the SCF, HRS, PSID, and SIPP — provide measures of retirement income that track closely with administrative data, especially in the middle of the distribution," writes the expert. "This study suggests that researchers should feel comfortable using the SCF, HRS, PSID, or SIPP to draw conclusions about retirement income for the typical older household."

It may sound crazy, but employees are leaving money on the table at work
Data from the Bureau of Labor Statistics show that workplace benefits, including retirement plans and health insurance, represent an average of 31.7% of the total compensation, according to this article on CNBC. However, Fewer than 30% of workers make the most of their workplace benefits. To maximize these benefits, employees should participate in wellness activities organized by their company, take advantage of tax-advantaged health savings account and ask for nontraditional offerings such as student loan repayment.

Looks like everyone is having some trouble saving for retirement
A survey by investing app Stash has found that 30% of people are inclined to cut back on their retirement contributions when facing a financial hardship, according to this article on CNBC. Only about 2 in 10 participants think that retiring at 65 would be possible for average Americans, with nearly 30% citing low wages as an obstacle in saving for retirement, the survey found. "Women, overall, report saving less money for retirement than men each month," says Stash chief marketing officer Dale Sperling.

This article originally appeared in Financial Planning.
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Retirement income Healthcare costs Alicia Munnell Center for Retirement Research