Should 20-somethings Save?
“I don’t have any savings,” said Lauren Martin in EliteDaily.com, and I couldn’t care less. In fact, I strongly believe that “if you have savings in your 20s, you’re doing something wrong.” Until recently, I had been frantic to save money, rarely eating at restaurants or going out with friends. I was too busy stressing about saving instead of “savoring my youth.” But then a very successful friend gave me a piece of advice: “Don’t save money. Make more money.” So now I spend without guilt. My 20s are for taking risks and enjoying life, not sacrificing to contribute to a 401(k). We Millennials are on different schedules than our parents were on at our age, from getting married to having kids to buying houses. “We’re not trying to live with safety nets.” We want to bet all our chips and reach higher. Putting aside “$200 a month isn’t going to make the dent that a $60,000 pay raise will after spending all those nights out networking.”
This advice is “jaw-droppingly wrong,” said L.V. Anderson in Slate.com. Martin wants to pretend that a few dollars saved now won’t help her retire some day. Has she really never heard of compound interest? She also insists that spending money today somehow translates into confidence and professional success. But “it’s not lack of a belief in oneself that’s standing between Millennials and $60,000 raises.” It’s the fact that wages have been utterly stagnant for years, while the cost of education, housing, health care, and basically everything else has gone up. You simply “don’t want to get to your 30s or 40s and find you have no money in the bank,” said Timothy Lee in Vox.com. The days when you’ll have kids and mortgages and sick parents may seem like a lifetime away when you’re 25, but “they are closer than you think. Sorry.”
Martin is right that taking risks in your 20s is “an undeniably great idea,” said Susie Poppick in Time.com. But spending your paycheck on overpriced drinks at a club in the name of “networking” is not the same as buying computer-coding or foreign language lessons that will actually help you score that raise and promotion. And just because retirement is decades away and you’re happy to rent forever doesn’t mean you won’t face unexpected costs tomorrow, said Shane Ferro in HuffingtonPost.com. You might lose a job, need a new apartment immediately, or have an unexpected medical bill. Everyone needs an emergency fund, and “saving for big things takes time.” So spend what you need to in your 20s. “Just don’t spend so much that it kills your quality of life in your 30s. (And 40s. And 50s.)”
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