What I’m Hearing…Generational Spending Patterns

Ever since I was a small child, I’ve always believed in saving things that might be valuable to me in the future. Plastic bags, office supplies, nostalgic items, and my most favorite thing to save – money. When I was about 6 or 7, I received a toy safe for Christmas, which I loved. I put all my dollar and five dollar bills in there, along with some business plans for the ideal restaurant I wanted to open when I grew up. I still have those plans. Perhaps that will be my second career after I retire.

So when I recently heard on the radio that one-quarter of Generation X workers live paycheck to paycheck, I was floored. The notion of living that close to the edge is something very foreign to me. I’m wondering if this is an HR issue, a cultural issue, or a combination of factors.

Looking at this issue through an HR lens, we can take several steps to prevent or mitigate this spending trend. We need to pay our employees equitably and fairly, as per our organization’s compensation philosophy. Annual market updates ensure external market competitiveness. We should also provide options for employee education on personal fiscal management.

More and more I’m seeing individuals who want to buy everything…right now. That type of spending approach will certainly lead to a lack of savings. I understand that the younger members of our workforce are juggling a variety of expenses, including cars, cell phones, rent, and student loans. While we as HR practitioners cannot directly change these social / cultural issues immediately, we can provide the tools to help our employees move away from the dangers of living paycheck to paycheck into something more secure.

What I'm Hearing...401(k)s

Anyone who’s familiar with the magazine Time Out New York knows that they like to publish articles that push boundaries and get people talking. In issue 642, they published an article called “401ks are for suckers.”

The best part of the article is that I recognize the location on 10th Avenue where they took the picture. It’s right by our old office.

In short, the author hasn’t saved a penny for retirement because she’s “living life” and enjoying eating out. She plans on living off “the dole at 65, eating cat food out of a rusty hubcap.”

Why should the falsely maligned “Steady Eddies” have to support her – and the millions of people like her – because some people take no responsibility for themselves? I know that she is not the only person who hasn’t saved for retirement. America’s going to be facing a large retirement crisis very soon.

Read it for yourself here