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Posted September 30, 2016 by

5 simple strategies for recent college grads struggling to save for retirement

save money words on a chalkboard illustrating back to school savings or instructions on how to save on your education costs

Save money now, reap the rewards later. Photo courtesy of Shutterstock.

We get it. You just graduated from college, and landed that first job. It’s an exciting time.

It’s also expensive.

You have your own apartment now, but rent is a lot higher when not living in that college town, or with fewer roommates to split the costs. Then there is that car payment and car insurance. And you are now paying for health insurance on your own for the first time. Wow, that is expensive, right? Suddenly, that salary you didn’t negotiate suddenly looks a lot smaller after taxes and deductions are taken out.

And let’s not forget those dreaded student loans you are starting to pay back. Those are a real drain, literally and figuratively. Did you borrow money from mom and dad? It might be time to pay them back too. It’s tough. And now that you finally have a job and are making some money, you want to have some fun and spend a little extra, go on a vacation, or splurge on yourself.

Save for retirement? Not now. There’s plenty of time, right? Yes, there is. But trust us, it’s never too soon for recent college grads and Millennials to focus on retirement. That may be the last thing an early-to-mid 20-something is thinking about, especially with so many other expenses.

But…follow the wise advice of professionals.

“With student loan debt and health care costs, many recent college graduates may think they need to defer or limit the amount they save for retirement until they have more money to put towards their retirement savings,” says Joe DeSilva, Senior Vice President/General Manager, ADP Retirement Services.

ADP’s annual study on retirement savings trends shows that employees age 20-24 defer an average of 4.6 percent of their pay into a tax qualified retirement plan, while employees age 55 and older defer an average of 8.5 percent. Yet, the cost of waiting does not add up. Recent graduates should instead start saving as early as possible – even if it is just a small portion of income.

“Being proactive today can reap big rewards tomorrow,” says DeSilva.

Below are four steps recent college graduates can take today to set themselves up for the retirement they want tomorrow:

1. Don’t wait to save until all your college loans are paid off: Save now to take advantage of compound earnings. If you wait even 10 years to start contributing to a retirement plan, you could miss out on many thousands of dollars in retirement savings.

2. Actively plan your retirement: Even if a retirement plan is offered by your employer, only you can take charge of your future financial security. Ask your Human Resources department for help in deciphering your benefit options.

3. Maximize your savings early in your career: Choose to have your employer automatically increase your retirement plan contribution every year.

4. Establish good money management habits: Focus on saving, smart budgeting and planning for emergencies. In other words, live only within your means.

While a recent college graduate isn’t likely to accept or move on from a job based on the retirement plan of the employee, it’s best to find an employer who at least offers a company match. That can help motivate recent college grads to start saving because it’s an easy way to start building your retirement base.

“While they may have many decades before retirement, Millennials can benefit from employers who guide them in making smart retirement savings choices now, at the beginning of their careers,” says DeSilva.

It’s never too early to start saving for retirement, even for recent college grads, entry-level employees and Millennials at all stages of their professional career.

Want to learn more about how to save money for retirement while managing the start of your professional career? Then stay connected to College Recruiter by visiting our blog, and connect with us on LinkedInTwitterFacebook, and YouTube.

Joe DeSilva, Senior Vice President/General Manager, ADP Retirement Services.

Joe DeSilva, Senior Vice President/General Manager, ADP Retirement Services.

About Joe DeSilva
Joe DeSilva is Senior Vice President and General Manager of ADP’s Retirement Services business unit, which serves a national client base of small, medium and Fortune 500 businesses. He is responsible for setting the strategy and overseeing the day-to-day operations of the business, which includes Sales, Marketing, Product, Development, Service and Operations functions.

The views expressed herein are those of the author, are intended for general information only and are not intended to provide investment, financial, tax or legal advice or a recommendation for any particular situation or plan.  ADP, LLC and its affiliates (ADP) do not endorse or recommend specific investment companies or products, financial advisors or service providers; engage or compensate any financial advisors to provide advice to plans or participants; offer financial, investment, tax or legal advice or management services; or serve in a fiduciary capacity with respect to retirement plans.  Nothing herein is intended to be, nor should be construed as, advice or a recommendation for a particular situation or plan.  Please consult with your own advisors for such advice.

 

Posted May 18, 2015 by

A Graduate’s Guide to Negotiating Your First Salary

Smiling woman having job interviews and receiving portfolios

Smiling woman having job interviews and receiving portfolios. Photo courtesy of Shutterstock.

Congratulations! Whether you’ve just graduated or you’ve had a couple months to contemplate the degree you’ve earned, completing a college career is no small task. And for many, it’s just the kind of warm-up you need for a successful job search. In my years counseling young professionals, I’ve helped many prepare for every step of their journey in landing the career they love. That’s formed the basis for this negotiation guide: (more…)

Posted March 20, 2015 by

How to Find the Career Path that Best Suits Your Personality

Graduation student choose his career in the future

Graduation student choose his career in the future. Photo courtesy of Shutterstock.

Whether you have already been on the jobs market for a while now or you are just approaching your college graduation, you have certainly asked yourself at least once: how can I find the career path that works best for my personality and lifestyle? How can you be sure you are making the right decision and heading to the right direction? (more…)

Posted December 05, 2014 by

Questions and Myths Regarding Your Nursing Career

Brian Short

Brian Short, Founder and CEO of allnurses.com

Whether you are a nursing student or a new grad, you probably have many questions surrounding your future as a nurse. Let’s look at a few of the more common questions and myths that keep coming up.

Why do I keep reading about a nursing shortage when I know nurses are having trouble finding jobs?

There has been talk of a nursing shortage for years, but it hasn’t fully kicked in – yet. That’s partly because many baby boomer nurses – group that comprises the largest segment of the nursing population – have delayed their retirement for a variety of reasons. As they continue to age and shift out of the workforce, the nursing shortage will become more apparent. (more…)

Posted September 17, 2014 by

What Does the Future Hold for Nursing?

No question that nurses are some of the most important people in the workforce.  So, what does the future of nursing look like?  For those who are interested in this profession, learn more from an infographic in the following post. (more…)

Posted June 13, 2014 by

Will Losing Baby Boomers in the Workplace Affect Employers?

As baby boomers enter retirement, how much will that affect employers in the workplace?  What, if any, concerns do they have?  Learn more in the following post.

One-fifth of the U.S. workforce has passed or is nearing retirement age, according to the Bureau of Labor Statistics, yet research suggests many executives aren’t too concerned with losing baby boomer employees to retirement in the next couple of years. Only 31% of chief financial officers (CFOs) interviewed for a recent Robert Half survey said they were worried about this possibility. 63% of financial executives reported being unconcerned. (more…)

Posted April 30, 2014 by

Searching for Recent College Graduate Jobs? 3 Career Myths to Keep in Mind

For those of you searching for recent college graduate jobs, the following post has three career myths to keep in mind.

If you’re reading this post on YouTern, there’s a more than an even chance you’re ambitious. If you weren’t, you’d probably spend your time on YouSlacker.com instead. Since you’re here, you’re eager for useful advice on building your career. First stop: awesome, resume-building internships. Next up: the coolest, resume

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Posted February 27, 2014 by

Companies Feel Good About Growth, but Challenged in Recruiting Candidates

Robert Half logoWhile companies feel good about growing in the first quarter of 2014, they are concerned about their ability to recruit top candidates for positions.  The following post has more information.

In a recent Robert Half survey, nearly all (91 percent) of executives interviewed said they are optimistic about their companies’ near-term growth prospects. However, they are less certain about their ability to recruit experienced talent for open jobs. In fact, more than six in 10 (63 percent) chief financial officers (CFOs) said it is somewhat or very challenging to find skilled candidates for professional-level positions today. (more…)

Posted August 09, 2013 by

Do Increased Teacher Salaries Mean More Learning?

The opportunity to learn is something students should not take for granted.  However, are students learning much in the classroom?  If not, is it due to the quality of teachers and how much is being invested in them?  The following infographic explores the potential of students who have teachers that are valued more monetarily. (more…)

Posted July 31, 2013 by

5 Financial Tips for College Graduates

Graduates smiling and holding diplomas

Graduates smiling and holding diplomas. Photo courtesy of Shutterstock.

Getting your degree is a huge accomplishment, and as you leave college and enter the workforce, it is important that you get a firm hold on your personal finances. Unfortunately, some new graduates make unwise decisions, which can set them back financially. But this doesn’t have to be your reality. (more…)