RISE Framework: Role-Based Instructional Prompting with Specific Examples

# Millennial Retirement Roadmap: Starting Late Without Panic

## Introduction
When juggling student loans, rising housing costs, and career instability, retirement saving often falls to the bottom of the priority list. This decade-by-decade roadmap helps you build retirement security even when starting later, with concrete steps that work alongside—not against—your other financial goals.

## Ages 25-30: Foundation Building Phase

**Target: 10-12% of income toward retirement (including employer match)**

### Priority Actions:
* **Capture free money first:** Contribute enough to your employer 401(k) to get the full match (typically 4-6%)
* **Build an emergency fund simultaneously:** Split extra savings between retirement and building 3 months of essential expenses in cash
* **Start a Roth IRA with any additional savings:** Even $50-100/month creates the saving habit ($6,000 annual max)

### Behavioral Strategy:
Set up automatic contributions that increase with each pay raise. Research shows "pre-committing" future income creates less psychological resistance than cutting current spending.

### Milestone Target:
**0.5× annual salary saved by age 30**

**EXAMPLE:** Miguel (27) earns $52,000 with $40,000 in student loans. He contributes 5% to his 401(k) to get his full 4% employer match, then automatically transfers $125/month to a Roth IRA invested in a low-cost target-date 2060 fund. His student loans are on income-based repayment, and he increases his retirement contribution by 1% each year.

## Ages 31-35: Acceleration Phase

**Target: 15% of income toward retirement**

### Priority Actions:
* **Max out tax-advantaged accounts in this order:**
   1. 401(k) up to employer match
   2. HSA if eligible (triple tax advantage for healthcare now and in retirement)
   3. Roth IRA (if under income limits) or Traditional IRA
   4. Remainder to 401(k) up to annual maximum ($20,500 in 2022)
* **Optimize asset allocation:** Aim for 80-90% stocks/10-20% bonds at this age
* **Consider housing's role in retirement:** Home equity can be a retirement asset

### Behavioral Strategy:
Create separate "retirement savings" account labels that prevent mental accounting errors where all savings feel interchangeable and accessible.

### Milestone Target:
**1× annual salary saved by age 35**

**EXAMPLE:** Leila (33) earns $78,000 as a project manager. She maxes out her Roth IRA ($6,000), contributes 8% to her 401(k) plus a 5% employer match, and adds $1,200 annually to her HSA. She maintains a moderately aggressive 85% stock/15% bond allocation, primarily through low-cost index funds with expense ratios under 0.1%.

## Ages 36-40: Optimization Phase

**Target: 18-20% of income toward retirement**

### Priority Actions:
* **Assess retirement trajectory:** Use a retirement calculator to check if you're on track
* **Consider a "catch-up sprint":** Dedicate 3-6 months to extreme saving (25%+ of income) to compensate for later start
* **Evaluate back-door Roth options:** If income exceeds Roth IRA limits
* **Review insurance coverage:** Ensure adequate disability insurance to protect retirement savings capacity

### Behavioral Strategy:
Connect with concrete visualization of your future self through aging photo apps or detailed retirement lifestyle descriptions, which research shows increases saving behavior.

### Milestone Target:
**2× annual salary saved by age 40**

**EXAMPLE:** Jordan (38) earns $95,000 with limited previous retirement savings. After calculating a significant shortfall, she implements a 4-month "catch-up sprint" by temporarily renting out her spare bedroom, pausing non-essential spending, and allocating her upcoming bonus directly to retirement—resulting in a $15,000 lump-sum contribution. She then maintains an 18% ongoing contribution rate.

## Key Principles for Any Age:
* **Focus on increasing income alongside cutting costs:** Career advancement often builds retirement security faster than extreme frugality
* **Benchmark fees relentlessly:** Each 1% paid in investment fees can reduce your retirement balance by 20% over 30 years
* **Automate everything:** Remove decision points that create saving friction

Remember: Every financial journey is non-linear. Progress means moving forward consistently—not perfectly—through the inevitable financial disruptions of millennial life.