Why one millennial avoids 401(k)s and uses trading accounts instead

Register now

Why one millennial avoids 401(k)s and uses trading accounts instead
A young investor described in this article from USA Today opts to invest his retirement savings in stock trading accounts instead of putting it in a 401(k) or IRA. “You can make some real money trading, but you really have to know what you are doing,” says an advisor quoted in the article. The young investor "sounds like he is more of a buy-and-hold investor focusing on large companies that provide stability, through dividends, but he has to think about how to save some money for the future.”

Buckle up to a new reality about retirement
Retirement coaching is slowly becoming popular among clients who are engaged in retirement planning, according to this article on Forbes. Many clients are acknowledging the importance of planning for the non-financial aspects of retirement, like replacing one’s work identity, living an active lifestyle, and keeping social relationships. Many financial advisors, human resource managers and social workers are now applying for Retirement Coaching Certifications and joining organizations like the Retirement Coaches Association.

Smart retirement solutions for women
Women are at a disadvantage when it comes to retirement saving, according to this article on MarketWatch. To improve their retirement prospects, women should make the most of the financial wellness programs offered by their employer. They should also take advantage of their employer-sponsored retirement plan's automatic enrollment and automatic escalation of contributions. Maintaining an emergency fund is also recommended.

Tackling your employee benefits and perks
Workers are advised to review their employee-benefit options and make changes if necessary, according to this article on CNBC. For example, they may want to increase their 401(k) contributions by 1% every year and determine whether they saved more than enough in pretax retirement accounts, says an expert. "When you retire, will all of your income be taxable? Funding a Roth IRA account is a great option for tax-free income in those years."

For reprint and licensing requests for this article, click here.
401(k) Small business Evaluation and coaching