Young investors should start saving early and invest in equities to fund retirement
Research from Prudential has found that while millennials expect to retire at age 67 and will need about $1 million to fund their retirement, 40 percent of them are not currently saving for their golden years. "There is certainly a disconnect between when they plan to retire and how they'll achieve the savings needed to get there," says Michael Rosenberg, head of Investment Only Defined Contribution for Prudential Investments.
Rosenberg cautions young investors to learn from today's retirees: The research found that nearly 20 percent of retirees surveyed wished they had invested more aggressively.
"The good news for young investors is that time is on their side and they shouldn’t be as concerned with equity market volatility," says Rosenberg. "As long as an investor keeps making contributions, the growth in a stock portfolio can be substantial compared with bonds, regardless of market conditions, due to the benefits of dollar cost averaging and the compounding of returns."
Want more information? Download the research, Prudential's "Financial Literacy and Retirement Preparedness" study. Want to speak with Michael? Contact Darrell Oliver.