What's the Ideal Age to Hit Financial Milestones?
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What is the main topic discussed in this episode?
With your Labor Day edition of your Money Briefing, I'm J.R. Whalen.
What did the Bankrate survey investigate about ideal ages for financial milestones?
So at some point in our lives, many of us think about key milestones. Buy a car, maybe get married. But how about when to retire, or buy a house, or get your first credit card? A recent poll revealed some interesting results, and Bankrate.com analyst Amanda Dixon has the numbers, and she's with us to discuss.
What age do Americans say is ideal to retire and how do views differ by generation?
So Amanda, let's start with retirement and work our way back. On average, Americans feel the ideal age to retire is 61. What did people in various age groups tell you?
Well, it's interesting. What we found actually is that the youngest Americans, so millennials and Gen Xers, actually think that it's ideal to retire at an earlier age. Gen Xers say 60 is the best age to retire and millennials say 61. Baby boomers say it's actually 62, and the oldest Americans say 65 is the right time to retire.
Wow, Gen Xers say age 60 to retire. That's a bit early. But if you're going to retire that early, good idea to have an aggressive savings plan in place.
That's right. You definitely have to make sure that you're saving from an early age and doing it consistently and doing it automatically. It should be the case where money is coming out of each paycheck and going directly into your retirement account.
And when the best time is to buy a house, it depends on who you ask and where they live.
What practical saving steps are recommended if you want to retire earlier than average?
What we found is actually if you live in the Northeast, it might be more difficult for you to buy a home at age 28, which most Americans say is the ideal age to buy a first home. What we found is actually 18% of people in the Northeast think you should wait until you're at least 35 to buy your first house.
How does the ideal age to buy a first home vary by region, especially the Northeast?
Why do you think that is? Why do you think Northeasterners want to wait so long?
I think Northeasterners want to wait a long time because the cost of living in the Northeast is pretty high compared to other parts of the country. And they're also spending a lot of their money on taxes. And it's just hard to find affordable housing in certain cities, especially in New York City.
And we'll hear more about the bank rate survey in just a moment, including when to get your first credit card and how men and women view financial milestones differently.
When do people think you should get your first credit card or first car, and how do millennials differ?
I found it interesting that in terms of getting your first credit card or buying or leasing your first car, millennials think that should happen sooner rather than later.
That's right. Millennials actually say that the best age to buy or lease a first car is 21, which members of other generations agree with. But when it comes to credit cards, 63% of millennials think you should get your first card before you turn 21. So that was an interesting finding.
And then when it comes to buying their first house, Americans on average feel that age 28 is appropriate.
And in some cases that might be reasonable depending on where you live. You know, like we talked about in the Northeast, that's very difficult.
How do men and women differ on ideal ages for milestones and what factors explain the gap?
And it really just depends on your financial situation and, you know, how much debt you're carrying, things like that.
And then Amanda, in the survey, there's an interesting difference between the genders as they answered the questions across various categories.
What we found is that men and women both say that 22 is the ideal age to open a first credit card and 21 is the right age to buy or lease a first car. But men actually think that it's best to retire at 60 while women say it's 62.
So maybe women a bit more cautious?
I would say that women have Other concerns, especially when it comes to the gender pay gap, for example, if they're not making as much money as men in certain cases, it might be that they have to wait a little longer to save enough money for retirement. And also you have to think about the fact that women might have to take time off to care for children and raise young kids or even take care of an elderly parent or relative. And so that's sort of a bit of a stereotype. But I would say that for women, that that is a big concern for many of them.
OK, that is Bankrate.com analyst Amanda Dixon joining us via Skype.
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Chapters
7 chapters
1
What is the main topic discussed in this episode?
0:05–0:08
2
What did the Bankrate survey investigate about ideal ages for financial milestones?
0:08–0:26
3
What age do Americans say is ideal to retire and how do views differ by generation?
0:26–1:27
4
What practical saving steps are recommended if you want to retire earlier than average?
1:27–1:47
5
How does the ideal age to buy a first home vary by region, especially the Northeast?
1:47–2:21
6
When do people think you should get your first credit card or first car, and how do millennials differ?
2:21–3:03
7
How do men and women differ on ideal ages for milestones and what factors explain the gap?
3:03–4:21
Speakers
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