Experian surveyed 1,020 millennial and Generation Z workers in August 2023 about their retirement savings habits.
Although workers with student loans probably aren't relishing repayments that begin again in October, they quite likely prefer to see either the principal decrease or notch another month of payments toward the 120 months needed for some types of forgiveness programs, like theBut suspending workplace retirement savings plan contributions has its own downsides, some financial and others attributable to the human condition.
Perhaps the worst reason to suspend retirement savings contributions is thinking you'll have plenty of time to catch up. Assuming even a conservative nominal return of 5% annually on retirement savings, every $1,000 saved earns an additional $3,300 after 30 years, either tax-deferred or tax-free, depending on the type of retirement account. Waiting just five years to"catch up" reduces that gain to $2,300.
Despite the answers, there are many well-designed retirement plans that already employ qualities of robo-advisors and AI. For instance,, available in most 401 and similar workplace savings plans, pre-allocate retirement investments based on one's expected retirement year. In general, asset allocation is heavily tilted toward stocks for younger savers such as millennials and Gen Zers.
Fortunately, there may be remedies that make either answer easier to swallow. Those answering in the affirmative, for example, may be benefiting from , which have received further enhancements over the years so that borrowers won't pay more than a small percentage of their discretionary income.The analysis results provided are based on an Experian-created statistically relevant aggregate sampling of our consumer credit database that may include use of the FICO Score 8 version. Different sampling parameters may generate different findings compared with other similar analysis.
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