In what could be considered a form of silver lining of the recent recession, a report by the Vanguard Group found that a growing population of young employees is joining a 401(k) plan. According to the report, of employees under 25 years of age in 2011, 44 percent participated in an employer-sponsored 401(k) plan compared to 27 percent in 2003. Workers aged 25 to 34 participated in 401(k) plans 63 percent of the time compared to 58 percent in 2003. Concurrent with the increase in participation in a 401(k) plan came a decrease in credit card debt, as expressed in data from Strategic Business Insight’s MacroMonitor. The report found that around 45 percent of Americans under 35 carried credit card debt in 2010, down from 63 percent in 2002.
A partial explanation of the new data stems from younger workers viewing the difficulty Baby Boomers are having during their transition to retirement. And while younger workers remain the most difficult section of the workforce to pitch retirement savings to, the growing concern over the economic viability of Social Security and the increasing number of tales of retirement woe may make the case better than any corporate advertisement.