Start Saving at The Earliest Age

Ideally if you’re saving for your retirement, you would need to start saving at the earliest age possible. The more you save during your younger years, the better the chance of you having enough money saved enough for you to retire comfortable. However, some us are not as lucky or privileged to be able to save during our younger years. Maybe you had a lot of obligations to take care of or circumstances were not in your favor.

Regardless, after you have settled all the things that need to be done, and have finished with all your duties and responsibilities, you decided to save for you retirement. But the question would be, is it too late? Will you still be able to save enough money to enjoy in full your retirement years? Like what I’ve always say, if there’s a will, there’s a way.

It is actually commonplace to see people in their 40s and even in their 50s without any kind of savings alloted for their retirement. There’s still hope for these people. The first thing that they need to do is to calculate how much they think they will need once they decide to take a permanent breather from their work and career. Don’t worry about exact figures, you can work with a rough estimate. You can go online and allow those online retirement calculators to do the estimates for you.

Once you have a figure, go to the various sources of retirement funds aside from your savings. These include social security benefits once you retire, company pensions, state pensions, and other sources of funds that you will get after you retire.

If you have a 401(k) plan, determine how much you will get during your retirement age. Get the total from these sources and subtract it from the estimate that you made earlier on. The resulting figure is the amount that will need to raise. It would be best to always use a conservative rate of growth in order to avoid overestimating. Personally, it’s best to underestimate the figures.

Determine other ways to fill in the gap between the money you have now and the money needed upon your retirement. This means signing up with any 401(k) or 403(b) retirement plans that your company has. You’ll need to find out the maximum contributions allowed by law. Take into consideration that various tax savings that you might get as well.

A fast way to increase your savings is to invest on something. And the best possible investment that you can make when you’re at 45 or 50 is on stocks. However, you need to research carefully the stocks market and the company that you want to invest your money. The best place to allow your savings to grow is in mutual funds or if nothing like that is available, you can put your money on carefully researched and proven stocks.

Another way to increase your savings is by living your life less. This means downsizing or moving to areas with lower costs of living, cutting down on your expenses, and looking for alternatives. Also avoid incurring any form of debts. If you have debts, get out of it as quickly as possible. You will end up using your savings paying for the interests of your debts, like those of your credit card balances, for example.

It’s not the end of the world, you can still save up for your dream retirement.

 

Posted by Ardent Editor on Jun 14 2007 in Retirement 101

  • Sponsors