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To really understand a generation, it's not enough to look at where they are now. You need to look at what they have been through.

The Millennial generation (roughly defined as those born between 1980-1996) will soon start turning 40. They're in the prime of their working lives; owning homes, raising families. In fact, they're now Canada's largest generation – 27 percent of the total population, according to Stats Canada.

And, yes, they're starting to think ahead to retirement.

But, this generation is facing some headwinds - they graduated right into the heart of the Great Recession back in 2008/2009, and that has shaped everything from how they see the world, to how they invest their money.

A recent report by RBC Economics lays out the struggle for Millennials. Youth unemployment in Canada at the time of their graduation shot up to over 12 percent, and 15 percent for young men in particular. Graduates were having trouble even finding work and, if they did, it was often part-time, or in a field that didn't match their education.

Now think ahead a decade, and consider how the effects of the Great Recession have rippled out to the present day. Half of the total increase in earnings over one's career comes in the very first decade — but Millennials only enjoyed 60 percent wage growth in that period, compared to 71 percent for those who entered the workforce earlier. In that sense, Millennials got the short end of the generational stick.

If some Millennials are counting on an inheritance from high-net-worth (HNW) parents, there may be a long wait. Boomers aren't going anywhere and, with longevity at record levels - roughly age 79 for men and 83 for women, according to Stats Canada - Millennials need to secure their own financial future.

Despite the challenging financial outlook, there may be some good news: No matter where Millennials are on their retirement path, there may still be opportunity to set themselves up for a secure financial future. The wisest choice may be to double down on goals, make up for lost ground if necessary, and maximize the time available.

After all, even for those Millennials turning 40 this year, they might still have another 30 years of their working lives left to go. That means plenty of room to define goals, revamp plans, supercharge their commitment to saving, and take full advantage of the magic of compound interest.

Taking stock of where Millennials are at with their financial affairs

In terms of retirement goals, Millennials generally are not yet where they need to be. Although 46 percent of Millennials recognize retirement saving as a top financial goal, only 38 percent are actually putting money towards the future, according to the Financial Independence In Retirement poll, by RBC. And half don't have an RRSP.

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“For someone turning 40, that's a good age to start making sure your financial affairs are in order," says Penny Forbes, a financial planning specialist at RBC Wealth Management Services — and herself a Millennial.

“Some Millennials may be feeling a little nervous, that they don't have everything figured out quite yet. But the good news is, there's still lots of time on their side."

It's important to remember not all Millennials are in the same financial boat. Since they are famously tech-savvy and more entrepreneurial than previous generations, some high-net-worth (HNW) Millennials have started their own companies – or even multiple -- and are facing HNW financial issues even at a relatively young age.

Add to the fact we're now undergoing what some in the industry call the greatest wealth transfer in human history. With many Baby Boomers solidly in their 70s at this point, having amassed historic levels of personal assets, much of that wealth is now being passed on to their Generation X (the cohort following Baby Boomers, roughly born from early 1960s to late 70s) and Millennial descendants – a sum that could amount to US$4 trillion in a generation, according to RBC Wealth Management's Wealth Transfer Report 2017.

That means Millennials need to formulate a financial game plan for the years ahead. A few thoughts for their retirement playbook:

1. Chart a course forward and create a plan

At age 40, especially if you have kids, everything in life seems to be going at warp speed. As a result you may not have even developed a strategy yet, because you're too overwhelmed keeping up with daily existence.

Understandable, maybe, but you should start developing that vision right away. “You need to have a sense of, 'What kind of retirement do I want?' " says Howard Kabot, vice president, financial planning at RBC Wealth Management Services. “What does that look like, and what will I need? This age is when you should start making those efforts, because it can help you get a good feel for exactly how much you should be saving."

Always keep in mind that today's costs won't be tomorrow's costs. With inflation and cost-of-living increases, as well as ramped-up medical costs as one ages, it's wise to aim high in your retirement targets.

2. Keep spending contained

As Millennials hit 40, they're inevitably entering a very expensive life phase. Raising kids, potentially helping put them through school, paying the mortgage, caring for elderly parents, as well as saving for retirement: Your outlay will probably never be higher than it is at that point. The danger is you might be tempted to over-focus on short-term goals, at the expense of long-term ones.

“I know one couple with two kids earning a high income," says Forbes. She describes how the couple had very little savings, took on a large mortgage and also completed a significant renovation. "At this age, you have to be so careful," she adds. Forbes recommends both couples and individuals live below their means and try to keep spending below what they can afford.

3. Take savings to the max

Although every individual's goals and circumstances are different, a standard practice is to put 10 percent of income towards retirement needs, says Kabot. If you're not at that level, then do everything you can to get there – drive an older but reliable car, don't overextend on rent or mortgage, ease up on all the Instagram-worthy vacations. And make savings automatic, paying yourself first to ensure it never gets dropped from your list of priorities.

But if you're at a 10 percent level already, then you can consider taking your savings up a notch. The maximum for RRSP contributions is set at $27,230 for 2020.

Your second tactic in the battle for retirement is the Tax-Free Savings Account, or TFSA. Current annual limits are $6,000, but if you've never opened one, you can contribute up to $63,500 including catch-up contributions from past years. Those savings (and withdrawals) are then tax free.

Once you have those basic retirement building blocks in place, you can start thinking about additional savings vehicles for other needs – school tuition for kids, eldercare, or health-related expenses.

4. Maximize employee benefits

Kabot cautions on some common missteps made in financial planning. “Not understanding what employers can do for them," says Kabot. For instance, if you're not taking advantage of matching programs for workplace retirement saving – that's leaving money on the table. Neither should you overlook stock purchase plans, where employees are often offered equity at a steep discount.

5. Revisit your allocation

One aftershock of the Great Recession is that Millennials are often skittish about investing in equities. Having seen the stock market chopped virtually in half — the TSX went from roughly 15,000 to 8,000 from May 2008 to February of 2009 — that imprinted on their brains, and they remain nervous to this day about taking on higher levels of risk. According to Missing Out, a study from the Ontario Securities Commission, 57 percent of Millennials who don't invest say it's because they're worried about losing money.

But “it's maybe another 30 years before you need to tap this money," Forbes says. “Some Millennial investors tend to want to stay in cash, because they never want to see a drop, or because they don't understand investing. But that's just too conservative."

After the Great Recession of 2008, the TSX did recover and is now at over 17,000. Kabot says that this serves to support the benefit of staying invested for the long term.

In short, as the authors of the RBC report The Recession Roadblock write: “Timing isn't everything, but it can't be ignored." While Millennials started out their careers with an uphill economic climb, they have ample time to apply those hard-won lessons and make it to the retirement summit.