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Advice I wish I’d received in my first job



Millennials already know on a gut level that they need to start saving for retirement. The tricky part is motivating them to actually sacrifice a portion of their first paycheck—for the sake of their 40-years-in-the-future selves.

So, we asked each of our experts what specific advice they would give to someone just starting out in her career.

Melanie Simons 

Saving doesn’t have to be painful—it can be an outright pleasure. When you’re first starting out, retirement is the last thing on your mind. Actually, it’s so many decades into the future that putting money aside for it now hardly seems consequential. People often talk about saving in terms of delayed gratification—but what about the immediate gratification of seeing your account grow? Start keeping track of your assets, using an app that shows you the real-time value of all your accounts in one view. Sure, spending is fun, but watching your net worth potentially get larger can be enjoyable, too. Please keep in mind that it is also possible to lose money when investing.

Cathy McCabe

Get in the habit from day one. Enroll in your 401(k) or 403(b) during your orientation—before you know what your take-home pay is. That way, you won’t miss the money being channeled from your salary to your retirement plan. Let’s face it, your take-home pay will have other pressing claims on it: paying off student loans, rent, maintaining a certain lifestyle. And remember, $100 pretax would only be worth around $80 in your pay check, depending on your tax bracket. Millennials don’t expect to be in the same job for life, and sometimes rationalize that there’s no point participating in their work 401(k) because they won’t be there for very long. But the funds you contribute remain yours, however many jobs you have. Most importantly, you shouldn’t touch that money when you leave, even though cashing it out can be enticing, especially if the balance isn’t very much. Instead, you can roll it over, along with all future 401(k)s, to the same IRA.1

woman jumping over rock adventure outdoors

Cindy Wilson

Save 10% of your salary—or even just $10 per month—regardless of how much you’re making. The key thing is setting up an account and creating the saving habit early on. That’s easier for some than others. I think it’s really important to know your personality type: Are you a pleasure delayer or do you need to work extra hard to defer gratification? The less conscientious you are, the more you need outside help to get on track, because you don’t have the self-motivation and discipline of the natural saver.

Hakyun Morrissey

Social Security may not be there for you, but you can do something about that. Young people know they have to put money into a 401(k) for their own future benefit, but how do you transform that abstract understanding into positive action? The future of Social Security isn’t clear, and the 401(k) and 403(b) do not offer lifetime income, like old-school pensions. Up until the 1980s, defined benefit plans were the norm, and workers didn’t even need to think about generating a lifetime income stream for retirement. That’s why young people need to get into the mindset of building a nest egg. And to do so, they need to be aggressive investors, early on. It is important to understand that there is inherent risk in investing in securities products, which generally increases with more aggressive portfolios.

Shelly Eweka

I was fortunate enough to sit alongside a coworker whose dad retired in his early 50s, and his example made a big impression on me, an impressionable entry-level employee. Like him, I got into the habit of maxing out my 401(k) even though it made a big dent in my paycheck—I simply acted like I was earning less. Nobody likes being told what to do, but if you put this maxing-out principle into place, you can quit being told what to do.

team meeting group of architects passing papers

Alicia Waltenberger

Start saving right away, even if it’s only $20 a week (which alone would grow to $330,000 by the time a 22-year-old reached the retirement age of 67, assuming a 7% rate of return2). When I was that age, I didn’t really understand the power of compound interest. So to help newbies just starting out, I give examples like this. To be eligible for your employer match, you might have to be employed for 6 months or a year, so find out when that kicks in and mark the date in your calendar. As soon as you can get your hands on that “free” money, take full advantage of it.

Francesca Maletta

Your retirement will look a lot different from your parents’. Defined benefit plans, including pensions, are becoming less common. Pay yourself first. You won’t miss what doesn’t appear in your paycheck. Aim for 10% of your pretax salary, and if you can’t manage that right away, at least defer enough of your salary to get you the employer match. Money can be tight in your early 20s, but you need to get into the percentage mindset. Plan to increase that percentage over time—certainly every time you get a raise.

Originally Posted 8.1.2018 by 


[1] Prior to rolling over your money to an IRA, consider your other options. You may also be able to leave money in your current plan(s), withdraw cash or rollover the assets to your new employer’s plan if one is available and rollovers are permitted. Compare the differences in investment options, services, fees and expenses, withdrawal options, required minimum distributions, other plan features, and tax treatment. Speak with a TIAA Consultant and your tax advisor regarding your situation. Review your options.
[2] This example assumes no withdrawals were taken and does not include the impact of any investment fees, expenses or taxes that would be associated with an actual investment.  If such costs had been taken into account, the results shown would have been different.  It also does not factor in market volatility.
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Teachers Insurance and Annuity Association of America has created and the information within it for informational purposes only. Many of the experts featured in the content are unaffiliated with Teachers Insurance and Annuity Association of America, College Retirement Equities Fund, and their affiliates and subsidiaries (collectively TIAA), and TIAA makes no representations regarding the accuracy or completeness of any information on the posts or otherwise made available by the individuals. Statements of external featured individuals are solely their own and are not endorsed or recommended by TIAA. Teachers Insurance and Annuity Association of America and LinkedIn Corporation are independent entities collaborating to bring you
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