This 72-pages booklet by JP Morgan focuses on how millennials will manage their finances and maintain their financial independence throughout their working years and through retirement.
Its analysis is presented in the form of a proposal for a web-based show (The Millennials) available for live streaming, complete with backstory, a list of episodes and detailed production notes.
Today’s 25- to 34-year-olds face increasing obstacles when it comes to saving for retirement. Despite being collectively more highly educated than other generations, millennials are inheriting a fast-changing world that is already cluttered with challenges: onerous student debt; global competition for the best jobs; below-trend wage growth; and rising pressure on the federal government to curtail Social Security.
The episodes tell the life journeys of millennials to reach a safe retirement, for different household incomes and life scenarios. These include from according to plan to unexpected life events that derail planned and achievable targets and force the tough choices like slashing spending to working longer.
The conclusion is that a good starting point to help maintain financial independence and possibly prevent having to make deep, unexpected reductions in retirement spending would be a plan that involves putting 9% to 14% of pre-tax income in diversified retirement accounts each year and saving an additional 2% of annual after-tax income.