Workers are saving more for retirement, led by Millennials-By Stan Choe,

Workers are saving more of their pay for retirement, led by the youngest workers

 

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FILE- This Sept. 19, 2013, file photo shows workers at the Target Technology Innovation Center office in San Francisco. According to a survey by Fidelity Investments, millennials between the ages of 25 and 34 are saving a median of 7.5 percent of their pay for retirement, including whatever match they get from their jobs. (AP Photo/Jeff Chiu, File)

NEW YORK (AP) -- Workers are saving more for retirement, and the youngest — not exactly known for squirreling money away — are boosting their savings rates faster than any other age group.

Millennials between the ages of 25 and 34 are saving a median of 7.5 percent of their pay for retirement, including whatever match they get from their jobs, according to a survey by Fidelity Investments of 4,650 households with at least $20,000 of annual income. That's up from 5.8 percent two years ago, when the last survey was conducted, and it is the largest jump among all age groups.

That's still not enough, but at least the trend is getting better. Financial advisers suggest socking away 15 percent of pay, and more if workers haven't saved in their earlier years.

Younger workers had the most room for improvement, because they were saving such a pittance. Older workers were already saving more of their paychecks. Workers aged 35 to 50 are now socking away 8.2 percent of their income, up from 7.7 percent two years ago. The oldest workers, aged 51 to 69, are saving 9.7 percent, up from 8.1 percent.

Several reasons are behind the rise, said John Sweeney, executive vice president of retirement and investment strategies at Fidelity, including an improving job market and economy. The unemployment rate is at its lowest level since 2008, and workers are feeling more comfortable in their jobs and with their finances.

Some workers are also saving more without knowing it, because their 401(k) and other retirement plans are automatically enrolling them and increasing how much they contribute each year.

Those programs tend to put contributions into a target-date mutual fund, one that takes care of how much to invest in stocks versus bonds based on how close an investor is to retirement. That means workers also generally have more appropriately balanced accounts than a couple years ago, Fidelity says. A target-date fund prevents a 20-something worker — who has the luxury of decades to go before retirement — from investing only in bonds, which are safer but have historically offered lower long-term returns.

The survey was Fidelity's attempt at measuring how prepared workers are for retirement. Fidelity looked at how much workers make, spend and save, as well as when they expect to retire, among other factors. It found that 45 percent are likely to afford at least their essential expenses in retirement, up from 38 percent two years ago.

Older workers are the most prepared for retirement, and not just because they've had longer to save. One reason is that older workers are more likely to have access to pensions, which guarantee income in retirement but have become rare in the workplace.

Older workers also seem to have more realistic expectations than those fresh out of school.

"The further you are from retirement, the more you still hold aspirations of retiring early," Sweeney said. "Boomers are saying it may make sense to continue to work and extend that retirement date from 62 to 65 or 67."

Culled from AP in yahoo finance

Survey: How Americans meet unexpected expenses-By Sheyna Steiner

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The washing machine broke, you chipped a tooth and the dog needs to visit a heart specialist. And that was just Tuesday.

Unexpected expenses are almost guaranteed to occur, but few Americans are budgeting for them by stashing money in savings each week or month, the latest Money Pulse survey from Bankrate.com has found.
Bankrate commissioned Princeton Survey Research Associates International to conduct its Money Pulse survey on budgeting and unexpected expenses. It interviewed 1,000 people December 17-20, 2015, with results having a sampling error of plus or minus 3.8 percentage points.
"The survey shows that a very significant minority of American households apparently don't have the resources to pay for an unexpected expense of around $1,000," says Stephen Brobeck, executive director of the Consumer Federation of America.
Unexpected expenses occur with such frequency that they should be accounted for by budgeting to save money for emergencies. In Bankrate's survey, 4 of 10 respondents or their immediate family ran into a major unexpected expense last year. Just 57% made it out of 2015 financially unscathed.
If you need a personal loan to respond to an unexpected emergency, check out the rates at Bankrate.com.

How people deal with unexpected expenses

Nearly 4 in 10 respondents, 37%, say they would pay for an unexpected expense with savings, Bankrate's survey found. That's about the same as December 2014, when 38% of people answered the same way.
Nearly a quarter of people, 23%, reported they would pay for an emergency by reducing spending on other things.
"Let's give everyone credit for that. 60% are taking grown-up responsibility for the expense," says Robert Fragasso, chairman and CEO at Fragasso Financial Advisors in Pittsburgh.
Credit cards would be an option for 15% of respondents. The same number said they would borrow from family or friends.
"If it were $10,000 in uncovered expenses, the answers might be different. If it's paid with debt and if the balance is not amortized quickly, it should be converted to a home equity line of credit to pay down as quickly as possible, but in the meantime, the interest becomes tax-deductible," Fragasso says.
In a nutshell, the interest from the first $100,000 of a home equity line of credit is typically tax-deductible.
"The other thing is that if you shop (for a HELOC), it will be a low interest rate around 2% to 4.5%," says CFP professional Herbert Hopwood, CFA, president of Hopwood Financial Services in Great Falls, Virginia.

How people act based on income

Not surprisingly in Bankrate's survey, those with higher incomes were most likely to say they would rely on savings for emergencies. Over half, 54%, of those earning $75,000 or more annually said they would pony up the cash for an unexpected expense.
Only 23% of people with yearly incomes less than $30,000 said they would use savings. And 9% of respondents in this income level said they don't know how they would pay for an unexpected expense.

Are millennials getting the hang of personal finance?

Millennials changed up their answers from last year. The trends for older generations were mostly unchanged.
In 2014, many more young people said they would have to reduce their spending to pay for an emergency.
In this year's survey, millennials were most likely to say they would use savings. More also indicated they would use a credit card, while fewer said they would need to reduce spending to meet an unexpected expense.

Note: Margin of error is plus or minus 3.8 percentage points.

Unexpected expenses are a learning experience

When asked how they had dealt with their most recent unexpected expense, 36% of respondents said they used savings. Another 20% said they dealt with it by setting up a payment program.
About 1 in 10 said they borrowed from family and friends, while another 11% said they haven't begun paying the bill.
Only 13% paid for their most recent emergency expense with a credit card.

Cutting cable but not the smartphone

To understand how Americans bolster their savings, Bankrate asked respondents how likely they would be next year to cut back on spending in 5 categories: dining out, coffee, cable or satellite TV, alcohol and cellphone plans.

Note: About 27% of respondents said they don't buy alcohol, and 22% said they don't buy coffee.

In terms of cost, restaurant meals and cable can be budget busters. For most people, cutting the fat out of their budgets means tackling the highest-cost items, such as cable TV. But in the end, it comes down to choices. Which expenses are negotiable, and which are mandatory?
"Don't cut things that are important. You don't cut your daughter's dance lessons, but (you cut) the superfluous things such as sending out for dinner. Do you have to eat out so often? Or, the latte factor," Fragasso says. "If you table up what you spend in the course of a year on coffee, you may be able to fund your IRA."
Cellphone plans also can cost an arm and a leg, but fewer people say they are willing to budge on that.
"The funny thing is that smartphone penetration is higher than the number of households with a computer at home. It's young people who are driving it up," Brobeck says.

Can you boost savings if you reduce spending?

Nearly two-thirds of adult Americans owned a smartphone as of April 2015, according to data from Pew Research. For those age 18-29, the number of smartphone owners jumped to 85%.
As vital as smartphones are to everyone, "don't by default take whatever plan the phone company gives you. Do you need all the data? Or, are you using all the devices?" Hopwood asks.
"I have an iPad that I rarely use, but I am still paying the cost of a data plan. Make sure you have the right plan for your usage and your needs," he says.
Acting proactively rather than reactively to reduce spending should help you boost your savings and increase your peace of mind. There's no way to avoid unforeseen expenses, but having a plan in place for emergencies could help you sleep at night.

Methodology: Bankrate's poll was conducted by Princeton Survey Research Associates International, which obtained the data via telephone interviews with a nationally representative sample of 1,000 adults living in the continental U.S. Telephone interviews were conducted by landline (500) and cellphone (500, including 269 without a landline phone) in English and Spanish from Dec. 17-20, 2015.

Statistical results are weighted to correct known demographic discrepancies. The margin of sampling error is plus or minus 3.8 percentage points.

Culled from Bankrate.com

Will you be Happy in your Retirement – Odunze Reginald C

According to an article in Yahoo Finance captioned “7 ways to Retire happy” Mandi Woodruff opined that In a new book, “You Can Retire Sooner Than You Think,” Atlanta-based investment advisor Wes Moss, offers an alternative to the traditional line of thinking. Rather than focus on a dollar amount to reach for, Moss decided to figure out what retirees needed to be truly happy in retirement”
“I wanted to go beyond simple income numbers,” Moss says. “I wondered what it really takes to get somebody to a point where they truly feel they have a cushion and they are also enjoying life.”
“In 2012, Moss conducted an online survey of more than 1,200 workers who had either already retired or were fewer than 10 years away from retirement. He asked them questions about what type of cars they drove, where they shopped, how much their homes were worth, and, of course, how much they had saved for retirement. But he also asked about their passion projects, how often they went on vacation, what types of volunteering they enjoyed, whether or not they were satisfied with their lives, and how much time they put into their retirement planning before calling it quits. (Moss did not ask participants about overall debt levels like student loans and credit cards, but did include questions about their mortgage debt).”
What he found was that more money doesn’t equate to more happiness. The happiest retirees didn’t all drive BMWs or take 12 European cruises a year, either.”

Basically what drives a happy retirement depends on an individual, as what makes Mr. A may not make Mr. B happy. These factors will therefore ensure a happy retirement.

1 Save for retirement: saving for retirement is a basic requirement in life especially in Africa where there is no social security. Saving for retirement in Africa is fast becoming important as the modernization has gradually eroded African system of social communism where in most communities; people gather together build houses for old people who do not have children to cater for them. As this has eroded, it becomes increasingly important to start saving for old age.  It is also important to embark on voluntary contribution as the mandatory provision of 18  percent is not quite enough  though I strongly commend the Federal government of Nigeria for increasing to 18 percent.

2 Make s rough estimate of retirement savings needs, the saving need is a strategic issue as most retirees came to the sudden realization that what they are getting as their lump sum is not enough, coupled with their desire to get a house and a car from their lump sum which is barely enough to cater for their immediate needs.

3 Develop a retirement strategy, it is very important to fashion a well defined retirement strategy. Transamerica Center for Retirement Studies (TCRS), noted that in developing a retirement strategy, it is important to do the following “create a plan , In creating a plan, consider lifestyle, living expenses, healthcare needs, government benefits, and other factors, as well as a backup plan in case retirement comes early due to an unforeseen circumstance

4 Know a lot about retirement investment, it is the inability for contributors knowing about investment that often drove them to annuity. Contributors should at one time or the other gets investment advice from their pension fund administrators. They can do this by attending forum organized by the various Pension Fund Administrators to get adequate information on investment strategies

5 Maintain a positive attitude towards life and pension inclusive; according to book of job what people fear most always comes to them. And according to Robert Schuler, in his book , “the power of positive thinking “ he noted that  one of the basic ingredient of success is maintaining a positive outlook to life, believe that you will make and you will make it, believe that you will not , and you will definitely not” Therefore maintaining a positive attitude in all aspect of life is pre requisite for all facets of life and Le Boeuf (1987:21) noted that “your world is a mirror and your mind is a magnet what you perceived in this world is largely a reflection of your own attitudes and beliefs. And life will give you what you attract with your thoughts. Think, act and talk negatively and your world will likely be negative. Think, act and talk with enthusiasm and you will attract positive results.

Happy Married Life: We cannot do without Wes Moss as he is one of the Authority in pension Retirement. In still the same article in Yahoo Finance (op cited)  captioned “7 ways to Retire happy” Mandi Woodruff observed that “Happy retirees are more likely to be married” As common as divorce is in the U.S. today, the overwhelming majority of happy retirees were married (76%) and only 9% were divorced. Less than half of unhappy retirees were married, while one-quarter were divorced, Wes Moss found. This is right on par with what past research has shown about levels of satisfaction in married and unmarried people — over the long term, married couples are much happier. It’s fairly obvious why two may be better than one in this scenario — dual incomes can make a huge difference in a couple’s financial outlook. On the flip side, divorce not only reduces both parties’ income but is also expensive to go through.

Odunze Reginald is the Lead Consultant, Chareg Consulting, a management and marketing  consultant  a social media and social marketing consultant , you can visit our twitter anchor @regydunze, find us on Facebook @ Reginald odunze and reginaldodunze.com, at google+ @ Reginald Odunze and at Linkedin@reginald odunze

5 Best Career Moves to Make in Your 30s-By Daniel Bortz

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What should your career goals be in your 30s? For many employees, the path to success involves transitioning away from a solo contributor role and easing into management.

Use this time to solidify your reputation as a leader, experts say — both within your current employer and in the industry as a whole. “People get tapped for promotions, high-profile projects, and job openings because they’re widely known for being great at what they do,” says Jennifer McClure, a talent strategist and leadership consultant in Cincinnati .

Take these five steps to put yourself on track for expanded responsibilities.
1. Bolster Leadership Skills
To exhibit leadership potential, you’ll need to take on more responsibilities, so look for tasks that will get you experience managing co-workers, says McClure. Volunteer to spearhead a high-profile project, supervise the intern pool, or oversee the launch of a big campaign.
“Take on more responsibility as a leader, even if you’re not directly compensated for it,” says Belinda Plutz, a career coach in New York City. By flexing your management skills, you’ll capture the attention of higher ups and position yourself for a promotion. You’ll also gain a new line-item accomplishment to bolster your resume.
2. Foster Peer Relationships
Research shows office friendships lead to better work performance, so it pays to nurture the connections you formed with colleagues in your 20s . But now is a good time to take relationships further into the professional sphere: While casual lunches and happy hours may strengthen friendship, they don’t solidify your reputation as a team player.

Take stock in your co-workers’ career development by inviting them to join you at industry conferences and networking lunches, recommends career consultant Donald Asher, author of Who Gets Promoted, Who Doesn’t, and Why. If they can’t attend, share what you learn at the event, says McClure.

Another tip from McClure: Be sure to praise your peers’ accomplishments at team meetings. Generous and vocal support can turn co-workers into advocates for your career as well.

3. Keep Ex-Bosses In Your Corner

When you leave a company, take your manager with you as a mentor. Though you’ll no longer be a direct report, you can continue to leverage the relationship by using the person as a sounding board for career advice.

At this point, your reputation also largely depends on what former managers have to say about you. Consequently, you need glowing reviews from them, both formally and informally; keep them up to date on what you’re doing and what new responsibilities you’re taking on.

When you’re looking for a formal referral, Linda Gravett, co-author of Bridging the Generation Gap, recommends prepping past managers by sending them the job description, your updated resume, and some background information on the company. Even a former boss is a supporter, he or she may need to understand what you bring to the table for a particular role, so “ask them to mention particular projects and achievements,” says Plutz.

4. Manage Your Public Image

Your LinkedIn profile is one of the best tools for getting spotted by recruiters; 87% of those recently surveyed by Jobvite said they use the website to find talent. Since you’re not limited in terms of space, don’t just create a carbon copy of your resume. Rather, use LinkedIn to deliver an expanded look at your achievements.

Seek recommendations from people who can back your expertise, says Courtney Templin, president at learning and development firm JB Training Solutions. She recommends providing a 360-degree view of your abilities; tap previous managers, peers, and interns or junior employees you’ve mentored. If you’ve worked with clients, have them speak to your customer service skills.

You can also use Twitter to show your expertise. Provide value by tweeting on industry news, says Gravett. Your bio should include your niche or specific interests (e.g., “tech consultant tweeting on small business and entrepreneurship”).

And consider developing a blog that focuses on a specific topic within your industry, and use SEO analytics to get more traffic. “Even if your posts aren’t widely read, blogging helps you formulate your thoughts and gives you interesting topics to talk about with your boss,” says Tamara Erickson, author of What’s Next, Gen X?: Keeping Up, Moving Ahead, and Getting the Career You Want. Make sure to cross-promote your brand by including links to your social media on the blog, and vice versa.
5. Upgrade Your Industry Efforts

You may have joined professional associations already, but this is a good time to go a step further. Instead of simply attending conferences, for instance, showcase yourself by getting on the speaking docket or moderating a panel. (Gravett recommends those with stage fright take a public speaking course before becoming a presenter.)

And take an active role in an organization you’re passionate about. “Becoming a board member, or volunteering on a committee, gets you in front of recruiters” and industry influencers, says Gravett.

Culled from Money.com