New survey suggests young adults are on the right track to retirement
OMAHA, Neb.–(Business Wire)–
Young adults understand the importance of starting early when it comes to saving
for retirement, suggests a recent survey from TD AMERITRADE Holding Corporation
(NASDAQ: AMTD). Nearly 60 percent of survey respondents age 18-34 expect to
contribute more often to a retirement or long-term savings account in 2010 than
they have in the past.
“It`s reassuring to see younger generations prioritizing and taking action when
it comes to long-term planning,” said Stuart Rubinstein, Managing Director,
investment products, TD AMERITRADE. “Starting early is key, keeping in mind they
can always cut back if needed. That option can put investors in a much better
position, as opposed to starting too late and not being able to make up for lost
Starting early allows investors to take advantage of the power of compounding,
and ultimately provides more freedom and flexibility later in life.
Suppose you were to start consistently investing $100 per month starting at age
21, continuing for 20 years and then stopping at age 41 a total investment of
$24,000. Assuming an 8 percent annual return, compounded monthly, you will have
accumulated $471,358 by age 67. However, if you wait until 20 years before you
plan to retire and start investing the same $100 per month for 20 years,
assuming the same rate of return, you will have invested an equal $24,000, but
you will have accumulated only $59,295. That`s a difference of over $412,000.
Investors can use TD AMERITRADE`s Cost of Waiting Calculator to estimate the
impacts of delaying their own retirement savings. They should also understand
the difference between saving and investing, the latter always includes risk of
TD AMERITRADE offers the following financial tips to help recent college
graduates and all young adults get a head start on retirement:
1. As soon as you receive a paycheck, save regularly even if the amount is
minimal. Your savings will add up quickly, compound over time and come in handy
for major purchases, such as a new car, a home or wedding expenses.
2. Track your monthly income and expenses and establish a budget accordingly.
This will show what you are able to realistically spend and help you avoid
turning to credit cards.
3. Be sure to participate in employer-sponsored plans such as 401(k)s or 403(b)s
to begin building your retirement savings. Ask about company matches or profit
sharing programs and try to invest as much as your company will match to
maximize your benefits.
4. Determine your long-term goals and use a free calculator like
WealthRulerTM(1) to help you assess your financial situation and devise a plan
to help you pursue those goals.
5. Increase your savings when you can, especially when you receive a raise or a
6. Subscribe to a financial magazine or visit financial Web sites at least a few
times per week. Educating yourself on money trends will help you become
financially savvy over time.
For tools and services to help plan for the long haul, visit TD AMERITRADE`s
online Retirement Center, offering help and guidance no matter where you are on
your path to retirement.
For additional survey findings, please visit TD AMERITRADE`s newsroom.
These results are based on a survey conducted by Infogroup | ORC of Princeton,
New Jersey on behalf of
TD AMERITRADE. 1,058 adults, employed full time, part time or self employed,
participated in a telephone survey conducted February 18-22 and 25-26, 2010. The
margin of error in this survey is ±3 percentage points. This means that in 19
cases out of 20, survey results based on 1,058 respondents will differ by no
more than three percentage points in either direction from what would have been
obtained by seeking the opinions of all eligible U.S. adults employed full time,
part time or self employed. Infogroup | ORC and TD AMERITRADE Institutional are
separate, unaffiliated companies and are not responsible for each other’s
products and services.
About Infogroup | ORC
Infogroup | ORC is a leader in global market research with expertise in
Information Technology and Telecommunications, Healthcare, Financial Services,
Public Services and Consumer Behavior. For more information, visit
About TD AMERITRADE Holding Corporation
TD AMERITRADE Holding Corporation (NASDAQ: AMTD), through its brokerage
subsidiaries,(2) combines innovative trading technology, easy-to-use and
understand trading tools, investment services, investor education and superior
client service to create a market-leading financial services experience. Now
home to the award-winning thinkorswim trading technology(3) and the Investools
investor education program, TD AMERITRADE provides millions of retail investors,
traders and independent registered investment advisors with the tools, service
and support they need to help build confidence in today’s rapidly-changing
market environment. For more information and resources for journalists, please
visit the TD AMERITRADE newsroom at www.amtd.com.
(1) Kiplinger`s Personal Finance magazine, December 2009, WealthRulerTM named to
2009 Best List: Retirement Resources.
(2) TD AMERITRADE, Inc., member FINRA (www.FINRA.org) /SIPC (www.SIPC.org)/NFA
(www.nfa.futures.org). TD AMERITRADE Clearing, Inc., member FINRA
(www.FINRA.org) /SIPC (www.SIPC.org).
(3) thinkorswim, prior to joining TD AMERITRADE, earned 4.9 stars, the top
score, in the category “Trading Technology,” and was rated #1 overall online
broker in Barron`s ranking of online brokers, 3/15/2010; thinkorswim was
evaluated versus others in eight total categories, including trade experience,
trading technology, usability, range of offerings, research amenities, portfolio
analysis & reporting, customer service & education and costs. thinkorswim topped
the list in 2006, 2007, 2009 and 2010 with the highest weighted-average score.
Barron`s is a registered trademark of Dow Jones & Company © 2006-2010.
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