Poor planning to force many Phoenix millennials work past retirement
PHOENIX — Poor investment planning will force more millennials to work past retirement age, a financial firm survey said Wednesday.
In its biannual survey, Merrill Edge said 82 percent of Phoenix’s work force expects to work during retirement, be it out of necessity, to keep busy or to pursue a passion.
“I was actually shocked seeing that number,” Tom Gustafson, a Merrill Edge spokesman said of the results.
While the survey focused on the entirety of Phoenix’s work force, Gustafson said the large number of people planning to work later in life bodes ill for the millennial generation, as poor retirement planning will lead to more of them being forced back on the job.
“I think that there’s just not a lot of planning going on with that millennial generation and it’s really not as hard as they think it is,” he said.
Gustafson said millennials — defined as those who are 18-34 — want to retire with money in the bank, but some may be going about it the wrong way.
He said the younger generation of workers has grown up with the internet and about 70 percent are self-taught investors. While he understands the thought process behind it, Gustafson said some may take much larger risks than are needed for the same financial return.
“The problem is … if you can put the time in to learn all the things about investments, you’ll probably do OK,” he said. “But in my experience, a lot of the people that try to do it themselves, they don’t look at all the angles and that could cause them problems.”
Gustafson said investing on your own is fine, but everyone — not just millennials — should check with a financial investor to make sure things are running as planned.
Gustafson also said millennials need to be realistic about the so-called “magic number,” or the amount of money they will need to live out the rest of their days.
He said most younger people have no idea what their number should be or vastly underestimate it by failing to include future medical expenses, among other things.
Gustafson said millennials should invest in a 401(k) or another retirement fund, live on a budget and stay away from debt to plan for their post-work days.
KTAR’s Ashley Flood contributed to this report.