The start of a New Year usually inspires people to make resolutions. In fact, Forbes reports that around 44 percent of people say they’re likely or very likely to make a resolution this year. And that number is higher among young adults ages 18 to 34 – around 59 percent of whom plan to make a resolution. And around 19% of adults 55 and older are likely to make a resolution.1
About 30 percent of those folks want to improve their finances in 2024, and 85 percent of of them say they think their resolution will have a positive effect beyond just this year.
We have an idea that can both improve your finances and have a positive effect beyond just 2024: increase your retirement savings contributions and develop a formal, written retirement plan.
Fidelity reports that around 55 percent of Americans aren’t prepared to cover basic expenses in retirement – like housing, food and healthcare. But when they drilled down further into the data, they found it varied depending on generation. For example, Gen Y – or the millennial generation – is not currently on track to cover a majority of retirement expenses, whereas a majority of boomers are. But Fidelity reported that for Gen Y, boosting retirement savings contributions into plans like 401(k)s to 15 percent of their income could significantly increase their chances of being prepared for retirement.2
Plus, the IRS has increased the contribution limits for individuals contributing to their 401(k) plans from $22,500 for 2023 to $23,000 for 2024.3 So the stars seem to be aligning to help you reach this financial resolution, which will likely have a positive effect beyond 2024. And it’s especially critical for millennials to work on a resolution like this.
In addition to boosting retirement savings, focus on having a formal written retirement plan in place as a resolution. LIMRA recently reported that only one in five retirees and non-retired workers have a formal written retirement plan.4 But it’s beneficial to have a written plan in place because it can actually help you boost retirement savings, PlanSponsor reported.5
PlanSponsor found that 52 percent of households with written plans save 10 percent (and sometimes more) of their income, whereas only 36 percent of households without written plans save that much.5
We can help you with both of these financial resolutions and identify what percentage of your income would be best to stash away for retirement. While many people use technology or apps to stay accountable, you have us to help you. Give us a call today and let’s get started!
We’re No Quitters!
During the pandemic, more than 50 million people in the U.S. quit their jobs to pursue better opportunities, according to Statista.6 People did so because they were looking for better pay, more opportunities for advancement and more respect, notes Pew Research Center.7
But these days, the problem for employers is that not enough employees are quitting. Inc. reported that companies rely on turnover to stay on budget, and since people are not leaving, many companies are relying on layoffs.8
While the Conference Board reports that 62.2 percent of American workers surveyed said they were satisfied with their job in 2022, up from 60.2 percent in 2021,9 The Ascent reports that 42 percent of workers are seriously considering quitting their jobs.10 Of those people who report they want to leave their job, it’s many of the same reasons those who participated in the great resignation left their jobs – unfair pay, poor work-life balance, feeling undervalued, and a lack of advancement opportunities, among other reasons. Of those surveyed, 20 percent said they wanted to switch industries altogether.
If so many employees want to leave their jobs, why aren’t they?
For one thing, “the labor market is no longer in job switchers’ favor,” Nela Richardson, chief economist at ADP, told CNBC.11
The New York Times reports that in addition, employees are worried about a potential recession, rising inflation and cost of living, and having fewer job prospects.12 Or maybe they’re staying put so they can stack as many Benjamins into their retirement account as possible!
However, if you are one of those 42 percent of people who is considering quitting a job in this tight labor market – or you’re worried about a layoff – you can do the following:
- Hire a professional to review or write your resume. A resume is still a valuable tool to showcase your individual skills and abilities and it could be helpful to hire a professional to review and/or help you rewrite your resume to give you the best shot.13
- Rely on your professional network. Reach out to your former colleagues and connections in your network to see what might be available. Check in with your professional associations and alumni associations, also. Networking might help you land something better.14
- Engage in professional development. Keep your skills up to date. Read industry journals, take relevant courses, and add new skills to your repertoire.14 This is especially important as skills-based hiring (relying on screening a candidate’s skills, rather than just looking at their resume and interviewing) is on the rise.15
Time magazine reports that job hunting in this market is miserable – you’re not imagining it.16 If you’re not at a job that satisfies you right now, remember that everything is cyclical – even tight job markets.
A Lighter Enchilada
It’s practically a New Year’s tradition to say we’re going to move more and eat better. And if you love enchiladas like we love enchiladas, you might need a healthier version to help you reach your goals. This sweet potato and black bean enchilada from EatingWell might be just the ticket:17
What you’ll need:
- 1 medium sweet potato, peeled and cut into 1/2-inch cubes (which amounts to about 2 cups)
- 1 tablespoon water
- 1 tablespoon canola oil
- 1 cup thinly sliced yellow onion
- 1 teaspoon ground cumin
- ½ teaspoon chili powder
- ¾ cup rinsed no-salt-added pinto beans
- ¾ cup canned mild green enchilada sauce (such as Hatch), divided
- 12 (6-inch) egg wraps with cauliflower (such as Crepini, or you could use corn tortillas)
- 3 tablespoons crumbled queso fresco
- 2 tablespoons roasted unsalted pepitas
- 2 tablespoons chopped fresh cilantro
How you’ll cook it:
- Place oven rack 8 inches from the broiler and then preheat broiler.
- Coat a 7-by-11-inch baking dish with cooking spray.
- Place sweet potato and water in a medium microwave-safe bowl and cover with plastic wrap or a plate.
- Microwave the sweet potato on high until it’s tender when pierced with a fork, which should take about five minutes. Then drain.
- Heat oil in a medium skillet over medium-high heat. Add onion and cook, stirring often for about three minutes until it’s softened.
- Add cumin and chili powder to the onions, stirring for about 30 seconds until fragrant.
- Stir in the beans and the drained sweet potato, stirring constantly until coated with spices and lightly browned. This should take about one minute.
- Remove from heat and then stir in about ¼ of the enchilada sauce.
- Place 2 heaping tablespoons of the sweet potato mixture in the center of each egg wrap; fold the wrap around the filling and place, seam-side down, in the prepared baking dish.
- Pour the remaining ½ cup enchilada sauce evenly over the rolled enchiladas.
- Broil until hot and bubbly, which should take about 2 to 3 minutes.
- Combine queso fresco, pepitas and cilantro in a small bowl. Sprinkle over the hot enchiladas.
- Serve immediately and enjoy!
The Retirement Quiz
Let’s test your knowledge on retirement facts and statistics (hint: some of the answers might be in this newsletter!)
- What is the contribution limit for 401(k) accounts in 2024?3
- What percentage of U.S. households say they want to work toward reaching long-term financial goals?5
- The average age of retirement among retirees is now ___, up from 57 in 1991.18
- True or false: Social Security benefits provide retired workers with around $22,000 per year.19
- C – $23,000
- A – 82%
- D – 61
DEAN, JACOBSON FINANCIAL SERVICES
Securities and Retirement Plan Consulting Program advisory services offered through LPL Financial, a Registered Investment Advisor, member FINRA/SIPC. Other advisory services and investment advice offered through Dean, Jacobson Financial Services, LLC, a Registered Investment Advisor, and separate entity from LPL Financial.