The American dream means nothing without retirement. The whole point of working hard your whole life is to earn the right to kick up your feet, rest under your own vine and fig tree, and enjoy the fruits of your labor in the last part of your life. Unfortunately, those of us who live in the realities of the millennial generation have come to accept that we will probably never get that chance through traditional means. For us, the game has been rigged from the start. We’re being priced out of home ownership, our paychecks are staying low despite the cost of literally everything rising drastically, we’re all depressed, and we’re probably going to die underneath the insurmountable mountain that is student loans. No matter how well and how slavishly we play the game, we’re just not allowed to win.
Retirement, too, is off the table for the vast majority of us – at least, according to the rules of the game we’ve been taught. One of the best things about us, though, is that when our backs are to the wall we come out swinging. Housing prices too high? A record number of us are creating family units out of friends and going in on homes together. Prices are rising? We’re buying smart and foregoing unnecessary expenditures so completely that it’s become a boomer meme that we’re killing their favorite industries, like diamonds and cable TV (which, especially in the case of the latter, good riddance). When it comes to retirement, if we want to stand half a chance at having it we’re going to need to break the rules and try options off the beaten path, just like we do with everything else. This article will review some of those options that might give us a chance.
Adding Stocks to Your IRA
Your IRA is going to be the best way to put things away for retirement. IRAs are overseen by financial institutions, and are generally a safe and secure way to put funds away. Traditionally, a portion of your paycheck goes to your IRA, or individual retirement account. That isn’t much of a help if your paycheck is so low that you need most of it to survive. Many of us, myself included, have had to withdraw funds from our IRA early just to cover living expenses. If you’re lucky enough to have an employer that will match contributions, you should consider diverting at least a little of your earnings to an IRA. That said, this will absolutely not be enough to provide a decent nest egg for you. You’re going to have to get creative with your IRA.
For our money, adding stocks to your IRA is the best bet. Investing is an entire can of complicated, tangled worms unto itself. That said, stocks can be a versatile, if risky way to increase your holdings. You’re going to want to avoid high-risk high-reward options unless you have a little money to potentially lose. No, sticking with something safer is the better bet for your future. For that, there’s one option that we recommend above all others as a great starting point: precious metals. Gold, silver, palladium, and platinum are going to be your best investments, particularly because those are the metals that make the tech industry run. We need them for conductors, transistors, and all the other wonderful little components in our gadgets.
Gold is particularly versatile. Some agencies will allow you to add gold directly as a holding to your IRA, which can be an excellent way to bolster your financial stability directly. The easiest way to do this is to transfer assets directly from your portfolio into gold. A gold IRA transfer is fairly easy to facilitate, and can offer some protection against more volatile market forces that act on other commodities. Generally, you should only allow precious metals to take up no more than 10% of your total holdings, but we recommend 5% as a safer number. That way, if it doesn’t work you haven’t lost much, and if it does work you’ve gained a little more.
You Really Need to be Automating Your Savings
Automated savings is a simple, effective strategy for maximizing how much money you’ve got at the end of your career. You simply designate a portion of your paycheck to go into a savings account instead of your spending account, and you can find strategies here. This can be an alternative to your standard IRA and 401k contributions, but it really should be used as a supplemental strategy to all of your options. The advantages of this method are that they give you direct control of your financial assets instead of tying them up in stocks, commodities, and institutions. Having a spread of options available is a smart choice. Much like your portfolio needs to be diverse to protect against dips in some markets, your retirement savings plan should be similarly diverse. Having an automated savings account is a good way to diversify your planning. If your IRA or 401k doesn’t work out, you’ll have automated savings to fall back on, and vice versa. It’s one thing to talk about all this in general terms, but let’s put actual numbers to this for demonstration purposes.
Experts say you should save up enough to have 80% of your annual income per year you plan to be retired. To put concrete numbers to that, let’s assume that you make $100,000 per year. That’s an insane number to be sure, but it’s nice and easy to use for our calculations, so please bear with me! You should plan to put aside $80,000 for every year you plan on being retired. Let’s assume that you’re planning for twenty years of retirement. That’s a whopping $1.6 million dollars you’re expected to have set aside! For a more modest income of $50,000 per year, you’re looking at $800,000 saved up! Overall, there are a lot of options for you for retirement savings, and the smart thing for you to do is look into these off the beaten path options.