Millennials want Financial Independence, not Retirement!
I get all worked up every time I read another one of the same articles on retirement. Save 1x your income by 30, 5x by 50, 12x by 67, yadda yadda ya. I really hate the way these people think. As if anyone in his or her twenties is going to stay with the same job earning the same income consistently for 30 or 40 years.
We're Millennials! We don't play by those rules. So what does that mean when it comes to our retirements? Should we bother saving anything if we're going to start the next Facebook? What if we're going to get an MBA in 5 years and then land a six figure job?
If you're anything like me, you've probably already tried one career and are on your second or third by now. Whether you went to business school and started fresh like I did or switched gears after a 5-10 year slog in banking, consulting, or big law, one thing is for certain: you are unique. So why do all the financial advisors recommend saving a certain percentage of your income every year, or working a certain number of years?
Instead, take a holistic view of your expected earnings over the next 30 or so years. Do you plan to work in Corporate America for a decade and then take a decade off to raise kids? Better save as much as possible while you can. Maybe you're going into business for yourself and can forecast income growth of 10% per year for the next 20 years - so it'll be more important to start small but ramp up savings consistently.
Consider, too, your lifetime expenses. Do you plan to have kids? Do you want to go back to school? Start a business in your 50's? Retire early?
Once you've considered the big picture you'll have a much better idea of what you need to do today.