The Crock of @#$% Report v.025

August 9, 2015
Millennials are saving — but they’re doing it wrong

There’s just one problem, however: That skittish mentality has pushed 20-somethings to keep their money in the modern equivalent of under the mattress or in checking or savings accounts where it accrues little interest, instead of investing...

1. You cannot claim that someone is saving wrong if they are accumulating money in a savings account or stuffing money under a mattress, any more than you can claim a child is saving wrong if the child continues to jam coins into their piggy bank. By definition, both are saving exactly right.

2. You cannot claim that someone is saving right if they are spending money to invest, on the hopes of making their money grow. Spending money is definitely not the definition of saving.

3. You cannot claim that someone is investing wrong if they are not investing at all, any more than it would make sense to argue that I am currently playing football wrong as I type this post from a reclining position on my couch. I cannot be playing football wrong if I am not actually playing football. Go figure. And for the record, there isn't even a football in my house.

4a. Even if you foolishly disagree with the definitions of saving and investing, you still cannot claim that Millennials are doing it wrong. Only hindsight can prove that. There is no guarantee that risky investments must increase in value over the long-term just because they generally have in the past. Past performance is not necessarily indicative of future results. It's one of the first things every potential investor is told to read. There are no sure things!

4b. If you claim Millennials are doing it wrong, then it is therefore just your opinion. 25 cents and an opinion could once buy you a cup of coffee. The opinion, of course, was optional.

5. It is my opinion, as a retired long-term saver, that skittish Millennials should consider U.S. Savings Bonds (especially inflation protected I-Bonds) as an alternative to stuffing mattresses with cash. I cannot guarantee that hindsight will be kind to that opinion, but it is something I have done and plan to continue to do.

This is not investment or saving advice, other than perhaps to point out that investing and saving are not the same thing, which is readily apparent if one has a dictionary handy.