Encourage savings young to start good habits

The future of the American economy is not certain. Even as the recession seems to be drawing to a close and more people are optimistic about the market, there are overarching concerns that the monetary problems are not over. With the fiscal cliff looming, the Eurozone still struggling to right itself and other international markets seeing ongoing shrinkage, saving money is one financial tip that every parent needs to instill in children.

Opening an account for a child at birth may not be soon enough. Some parents even begin the process when they get married, choosing to put money aside to handle early care costs, but there need to be funds in a separate account for the future of that child when it reaches adulthood. College is becoming more expensive all the time, and basic living necessities are also constantly going up in price.

Shifting priorities
These trends are leading young adults to also consider more aggressive savings plans, Reuters stated. People born between 1979 and 1991, known as Generation Y, are seeing a negative economy that may not allow them to retire at the same age or with the leisure of their parents, let alone grandparents. In response, those in this age group are looking for more financial investment advice and banking alternatives that allow them more control over their assets.

"They want to take action," Merrill Edge leader Alok Prasad told Reuters. Since 2000, investment planners have seen a 10 percent jump in the number of young people investing in their own retirement strategies, including long term negotiable instruments and 401(k) plans.

Phoenix, Arizona, Fox affiliate KSAZ-TV wrote that some of the problem these investors may see is with themselves. The Employee Benefit Research Institute reported that a recent survey showed nearly two-thirds of those currently employed value their entire asset portfolio at under $25,000 including housing, vehicles and savings. Such shallow resources make it impossible for many people to retire, and with the fiscal cliff threatening Social Security and other programs aimed at helping people in their old age, more septuagenarians may stay on the job in the future as assistance runs dry. Starting to save young can help children avoid these outcomes when they get older.

If you wish to receive a printed copy of our Privacy Notice, please contact our Customer Care Center at 1-888-692-2654.

© 2015 First United Bank & Trust. All rights reserved.