The wisdom of old age shouldn’t be wasted by young people

By DENNIS GRUBAUGH
     Here’s a quick quiz:
     – How many of you over the age of 50 had a father who worked in the same job nearly his entire adult life?
     – How many had a mother who stayed home to take care of the family?
     Now, how might those answers differ if you’re between the ages of, say, 18 and 40?
     I’m a Baby Boomer, and I know how I’d answer. My dad worked at Olin Corp. in East Alton for 41 years until his retirement. My mom took many years out of the workforce for the even harder job of raising kids.
     The parents of millennials — and I am such a parent — have seen a whole new pattern emerge with younger people, and it’s not necessarily bad. The way they live, work and pursue their pastimes is different than anything I would have considered, and definitely different than anything generations before me would have considered. Part of that has to do with the variety of options out there. More than ever, the world is today’s generation’s oyster.
     Millennials in urban areas often live and work in the same neighborhood, shirking automobiles and happily getting back and forth on bikes. Many young people put off families, do all their shopping online, and think nothing of traveling at the drop of a hat to just about any place on earth, so long as they can afford it.
     They will work in a job (provided they can get a job) until they tire of it or until they seek something more prosperous. Back in the day, you stuck with a job whether you liked it or not because, well, that’s what you were supposed to do.
     People growing up today are likely to have five or six jobs by the time they hit 40.
     They also put less priority on retirement. A startling number of younger people haven’t put a cent toward their old-age costs. Many older people are falling short, too.
     And that might be what frightens me most about Americans’ savings habits. Many people my age are discovering they haven’t saved quite what they should have — and they worry about it. The generation coming up hasn’t even got to the point of worrying. Or worse, they’ve given up on the possibility.
David Rosell has thoughts about this, too.
     “Every generation has had its own set of trials and adversaries to conquer,” says the financial professional and author of ‘Keep Climbing: A Millennial’s Guide to Financial Planning.’ “However, today’s generation of young adults faces a uniquely challenging environment. And saving money for retirement is a luxury that many just can’t afford.”
But saving early pays dividends later. According to Rosell, if you start investing $2,000 a year for seven years at age 19, you could be a millionaire by age 65, given the miracle of compounding interest. On the other hand, those who start saving at, say, 26, risk having less money overall at 65, even if they invest during more of those later years. It’s the length of the investment combined with the compounding that adds up the most.
     All this is easy to say for young people emerging from school with mountains of debt, mouths to feed, and bills to pay. There isn’t a lot of cash lying around. More and more people save less and live for today because they can’t imagine tomorrow.
     I’ve preached to all of my kids about the significance of saving for retirement. I think (or at least hope and pray) that we’re all on pretty good ground. But if a lot of my peers are shaky in their standing, I can only imagine what generations to come are going to face unless they get real about their old age.
     Dennis Grubaugh is editor and partner of the Illinois Business Journal. He can be reached at dgrubaugh@ibjonline.com or (618) 977-6865.