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Retirement financial planning takes sacrifice, saving now

WLUK file image.

GREEN BAY (WLUK) -- Generation X is caught in the middle between baby boomers and millennials. In preparing for retirement, that puts them in the position to learn from the boomers’ mistakes in not saving enough, and the millennials burden of higher college debt.

Brent Weycker is a Generation Xer. He's 46. He started his own business in his mid-20s at a time when the average Generation Xer began putting money aside for retirement.

“You know I started a business so unfortunately my early money and capital went to the business and getting it going,” said Weycker. “So some of the years when you really should be saving a lot I didn't have money to save.”

But Weycker had saved enough early on to start that business. And he encouraged others to save, including his employees at Titletown Brewing Company. Those employees typically are college students with that first job.

“It was really hard to push people to save,” said Weycker of his young employees.

Weycker even offered his employees a way to save -- a 401(k) plan at work with a matching dollar incentive. But the idea of saving for retirement 40 years away got overshadowed. Very few of his employees contributed to the plan, and it was dropped.

“America, we're not good at saving and I see it amongst my staff at work,” said Weycker. “You know it's hard to put that money aside and put it away and kind of use self-discipline to save. It's hard.”

Financial analysts recommend saving 10 to 15 percent of your paycheck. Savings, social security, a pension if you've got one, will all contribute to your retirement wages, which should equal 70-80 percent of your pre-retirement wages.

But savings will likely make up the biggest portion.

Economists and financial experts recommend at the low end you'll need at a minimum of $1 million in savings. And likely more.

“You might be looking at a Gen Xer who might need to save more like $1.5 million to $1.6 million,” said Marc Schaffer, an assistant professor of economics at St. Norbert College.

“When you hear those numbers they become so big, they're so daunting thinking about personal situations, they're just like I can't even imagine saving that much. I think it's somewhat defeating for a lot of people,” said Schaffer.

Schaffer says Generation Xers came into the 401(k) system after it was a little more established, making them a little more prepared.

“I think each generation has gotten a little, progressively, better because they’re starting to learn from the previous generations,” said Schaffer.

A change in a federal rule could make it more difficult for some trying to save for retirement.

On May 17, President Donald Trump signed a resolution ending a regulation dating to the President Barack Obama era that encouraged states to set up retirement plans. It was for the tens of millions of people who don’t have access to a retirement plan through their work. Several states have been pushing to create their own plans.

AARP supports greater access to retirement plans to help insure retirees don't come up short.

“That puts less pressure on the state of Wisconsin and the federal government to have to provide that gap,” said Jim Flaherty, a spokesman for AARP in Wisconsin.

Many of the companies that don't offer retirement plans employ younger, lower wage earners, not focused on retirement, like some employees at Titletown Brewing.

“I'm a little more worried about some of the younger generation, that don't save because saving is important,” said Weycker. “You've got to be frugal. It's hard. It's disciplined but ultimately it pays off.”

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