Saving for retirement is not something you have to worry about until you’re like 40, right? That should give you enough time! This statement is fore false than quotes found on the internet. So when should you start saving for retirement? Learn how and when to start, then act on your knowledge.
Save for Retirement Now
If you don’t start saving in your 40’s, when should you start saving? The answer is as soon as you can. Financial advisors suggest starting to save for retirement right out of school. Right when you start earning a paycheck, you should be saving for retirement. Professionals suggest saving so early because the earlier you start saving for retirement, the more time your money has to grow. Each year, the gains grow on top of themselves. This creates a wealth building, snowball effect, known as compounding. An example of how drastically saving for retirement young can be is if you start saving at 25 years old. You put away 3,000 per year in a tax-deferred retirement account for 10 years. Then you stop saving altogether. By the time you reach 35, your 30,000 will have reached 338,000, when assuming you are making an average of 7% annual return.
Another Example
Let’s say you save the same amount of 3,000 each year, at the same return of 7% per year, but you only start saving at age 35 this time. When you reach 65, your money will only have compounded to 303,000. This difference is huge.
Where to Save
There are many safe and affordable investments to choose from. Many experts believe that investing in 401 k’s and IRA accounts are the smartest and safest form of investments. Both savings accounts are tax-favored or tax-deferred accounts. That means the money in the account is not taxed by the government until you withdraw money.
Do not wait until it is to late to save for retirement!
Why wait a moment longer to secure your family’s future with life insurance? Act now! Reach out to one of our life and financial experts today! Choosing the best life insurance plan isn’t always easy. There are many factors to consider and our experts can help you make the right choices.
Did you know life insurance can be used to save for retirement, and to help pay off debt?
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