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Lauren Bringle Jackson, 32, has occasional flashbacks to the 2008-09 recession.Source: Lauren Bringle Jackson

Millennials have a dubious distinction: Smacked for the second time in young adulthood by a global economic meltdown.

Maybe this time, they are more aware of what's coming. 

More than half of millennials said they expected the pandemic to have an impact on their retirement plans, according to a TD Ameritrade study.

 

Here's a look at how the Covid-19 lockdown and its economic aftermath have affected savings strategies and how people in their 30s have pivoted to cope. 

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Lauren Bringle Jackson, 32, graduated from college during the Great Recession, and that time is cemented in her memory.

She learned to live on very little, and one of her many jobs was volunteer work at a farm in exchange for food.

"Even though my current job is stable, it's almost like I have PTSD from my previous experiences, and feel even more pressure to succeed and save in light of the current crisis," said Jackson, who lives in Austin, Texas, and is a content marketing manager with financial services company Self.

Though her bottom line is unaffected, her underlying money fears are triggered. She scours her accounts, looking for ways to economize. "It feels very stressful some days," she said.

Uncertain times   

When Janet Vickers, 34, was furloughed in March, she was told she'd return on August 3.

That date is looming and Vickers, a commercial real estate attorney in Atlanta, says she has no confirmation date and no update. "I'm hoping to hear some confirmation by July 15," she said.

Vickers and her husband live on his income as well as her unemployment check, and have been able to avoid dipping into savings.

They are better off than some of their contemporaries. About a quarter of millennials surveyed by TD Ameritrade said they had taken money out of savings or considered doing so.

VIDEO1:2201:22How to protect your financial future if you've been furloughedInvest in You: Ready. Set. Grow.

Vickers has contacted previous clients and employers, and has an interview June 30 for a job she wants — but it would mean relocating.

Her three kids' fall school schedules are also uncertain. They can attend elementary school virtually full-time or go back in person, but it's not clear that schedule would be five days a week. "We don't know if we'll have to juggle educating three kids and doing two jobs," Vickers said.

Vickers says it's time to return to basics: stocking the emergency fund, canceling the gym membership, not spending on extras like eating out and considering switching to a 30-year mortgage, from a 15-year one.

"We're trying to aggressively pay off a car," she said. "The plan is, that will be paid off by the end of the summer, and it will be one less bill to have to worry about."

Less takeout Cheynne Whitfield, 31, says unnecessary spending is out and beefing up her emergency fund is in.Source: Cheynne Whitfield

A busy lawyer who used to buy dinner five nights a week, Cheyenne Whitfield, 31, spent the first two months of the pandemic cooking all her meals.

"I've never bought more groceries in my whole life," said Whitfield, a defense attorney in Tampa, Florida.

In fact, people working from home said they are spending an average of $182 more on groceries and $121 more on utilities each month, according to a survey from CreditCards.com.

Whitfield is treating the pandemic as an opportunity to meet some financial goals, such as investing in her Simplified Employee Pension individual retirement account and taking her emergency fund to four months of expenses. She is now working on getting it to a six-month cushion.

Her income has definitely taken a hit. It's hard to ask people who aren't working to choose between keeping a roof over their heads or paying legal fees, says Whitfield, who owns her law firm.

With much of her work stopped until the courts fully reopen, Whitfield says she is even more determined to grow her real estate investments and other side hustles that bring in more income.

Sheltering in placeJoy VinesSource: Joy Vines

Covid-19 changed almost everything for Joy Vines, 34, a writer and child-care provider in Cheyenne, Wyoming. She went from three part-time jobs to one: marketing and advertising for her husband's young adult novels.

Since both her children have medical needs that increase their risk of contracting Covid-19, neither will attend school in the fall — which will cut into her own time spent blogging and writing books.

Vines and her husband paused contributing to their IRAs, though her husband is still putting money in a 401(k) in order to get his company's matching contribution.

On hold are the couple's plans to buy an investment property. "There's financial uncertainty for our family, and as far as what housing values are going to do going forward," Vines said. "We don't want to end up in a situation where we are over-leveraged."

They're also working on boosting emergency savings. When the pandemic started, Vines and her husband had three months of expenses and wanted to get to 12 months. They are currently at six months.

Not much money is spent going out: "With the kids' health risks, we are just staying home," Vines said. 

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Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.

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  • Personal loans
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  • TD Ameritrade Holding Corp

News Source: CNBC

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Blowout jobs report may have missed a troubling trend linked to coronavirus

VIDEO1:2301:23Jobs report missed a troubling trend, Crossmark's Victoria Fernandez warnsTrading Nation

The latest jobs report shocker may have missed a troubling trend.

Crossmark Global Investments' Victoria Fernandez warns it didn't capture the fallout from surging coronavirus cases.

"The data was collected through the middle of June,"  the firm's chief market strategist told CNBC's "Trading Nation" late last week. "It was really the second half of June when we saw states like where I am here in Texas start to reverse their opening up plans. That did not get captured in this number completely."

Fernandez, who oversees $4.8 billion in assets, believes it's a major reason for investors to curb expectations.

"People have to be prepared that we could see something that's maybe a downside surprise when it comes to the July number," she said, adding the weakness will start showing up in the weekly numbers.

June's employment numbers, which revealed the biggest single-month payroll gain in the nation's history, marked the second month in a row that sharply exceeded expectations. 

The latest report showed payrolls jumped by 4.8 million. The Dow Jones survey of economists had expected a 2.9 million gain. Plus, the unemployment rate dropped to 11.1% from 13.3%.

May also delivered shocking upside as states began restarting their economies. 

But with several states rolling back reopenings, Fernandez is on alert.

"We look at jobs that are coming back, and yes, we had great gains in leisure and hospitality, in retail, in health — all of those were really strong numbers," she said. "But those are all the same jobs that are going to be affected in states like California, Texas, Arizona [and] Florida as they all turn around their plans."

'You have to be careful'

Her biggest economic concern: It'll derail the surge in consumer spending and retail sales, an area that has been on her watch list. She cautions a setback would hurt the overall economic recovery.

"If you look at the four states I mentioned earlier that are actually slowing down their opening plans, they're about 30% of the U.S. GDP and some of the states that are opening up in the northeast are about half of that," said Fernandez. "So, we're going to have to see a lot more positive numbers in new states that are opening up to counteract the decline that we're seeing elsewhere."

Due to the uncertainty, she's urging caution and telling investors to avoid making big bets in the stock market right now.

"You can be opportunistic in some of your holdings, but you have be careful," Fernandez said. "That consumption and that demand is really key."

Disclaimer

VIDEO5:4105:41Jobs report didn't capture the coronavirus case surge: Crossmark GlobalTrading NationRelated Tags
  • Recessions and depressions
  • Donald Trump
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  • Elections
  • COVID-19

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