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24HourForums.com > Supported Forums > 24's Money Business > Save and hurt now, or not, and hurt later! |
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Cars Original500© Member  Love Living Large
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I have previously mentioned the importance for "young folks" to try to save as much as they possibly can for their retirement, early on! I just came across this interesting article today that re-enforces that fact! So youngsters, as hard as it may be at this time to save for the future, save, save, save. You'll be thrilled you did when you really need it at retirement time!!! Ignoring the Early Years Ignoring retirement is easy when you're in your early 20s. After all, there's plenty on a recent grad's financial plate: scraping together the cash to pay rent and student loans, digging out of credit-card debt, and, well... one has to live a little, too. "Huge numbers of young people, even when they could join a 401(k), don't," says Alicia Munnell, director of the Center for Retirement Research at Boston University. That's a mistake you'll regret when you realize just how much more money you'll retire with if you start saving early. Consider this: If at age 25 you started contributing 10% of your income to a retirement plan and then stopped contributions when you turned 35, at age 65 you'd have saved the same amount as if you started contributing at age 35 and contributed for the rest of your working years, Munnell says. Thanks to the power of compounding, contributions made early on will have much longer to grow and multiply. "If you start saving early, that's the most potent thing you can do," Munnell notes. The good news: Because 401(k) contributions are tax-deductible, the bite out of your paycheck will be smaller than your actual contributions.
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24HourNut Administrator  Body pillows rock!
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Great post, Cars - getting that compound snowball started sooner rather than later is gigantic! I used to push my younger cousins and relatives to start all the time. A few did, and are very happy about it.
 The best human beings start good new topics and vote on the better posts. |
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Cars Original500© Member Love Living Large
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Right Frank! When I was part of the working young, I always participated in my company's 401K matching program. However, I now regret that I did not contribute "more" into my 401K account early on! (When it was very hard to make ends meet) I never thought I was going to see retirement when I was young, so I only half heartidly participated, putting in only the minimum 2% allowed! Over the years my smart wife convinsed me to gradually keep increasing the percentage. When I got to about 50 or so, I increased the percentage to the max, and after about age 55 I even added 4% more than the max. Luckily for me, doing that has left me financially quite comfortable now! But one can't help but to think, god only knows how much more I would have had now, (I know, being greedy!) if I started to save more when I was 25!!! So save, save, save, you youngsters, you'll be glad you did!
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Pyrite Original500© Member 
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When young, invest in something other than beer. Wish I had. Dr. Laura had a good one the other day. She told some gal to FIRST get some "extra" money from saving on something and then SAVE half and SPEND half. With emphasis on MUST SPEND HALF. In order to keep saving from becoming a distasteful chore. Good advice, I thought.
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librtyhead Original500© Member 
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It is amazing how much you can save by putting away 25.00 a week. But I have to learn to stop hitting it when I see a coin I like.
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Erinna1112 Original500© Member  Witty clever title pending
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http://www.daveramsey.com/etc/cms/index.cfm?intContentId=64 IMO, being able to explain this page should be a requirement to graduate high school. Last edited on 11:12 pm by Erinna1112 |
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24HourNut Administrator Body pillows rock!
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Erinna1112 wrote: http://www.daveramsey.com/etc/cms/index.cfm?intContentId=64 Boy are you dead on. The factors of compounding and time expressed in that example should be known to them, like you said Erinna, to help make them feel the intense waste of not starting younger. I have seen that type of example many many times in the past and it moves me each time.
The best human beings start good new topics and vote on the better posts. |
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moguitar Guest
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There is the assumption of the same relatively stable economy that has existed since WWII. What if the dollar collapses as some say? How about a takeover by basically, thieves who tax it all a lot? You have your retirement in a bank that closes its doors. I think we are looking at a far less stable future economy, and possible world depression 4 x worse than the 1930s around 2025 or 30. Money will be worth far less and ammo and food worth far more. We've been warned about China collapsing the dollar in a month or two to 2 years. The idea of compounding interest early is valid only in a long term relatively stable economy.
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24HourNut Administrator Body pillows rock!
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moguitar wrote: There is the assumption of the same relatively stable economy that has existed since WWII. What if the dollar collapses as some say? How about a takeover by basically, thieves who tax it all a lot? Very true - but the point is still valid for money that you are going to put away in a compounding vehicle. You are making a case for great diversification. But money that is going to go into the markets or interest-bearing items are slaves to the point in that link. Even if you go with the safest, insured, bank CDs.
The best human beings start good new topics and vote on the better posts. |
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Erinna1112 Original500© Member Witty clever title pending
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For those of us who aren't paranoid conspiracy theorists, that example has a lot of validity.
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Pyrite Original500© Member
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I wanna know where Ben and Arthur found the 12% for their entire lives. I got close, but limited myself. I took some Treasury strips at 12.45% in 1983 or 4, but I was too conservative and picked maturities to be when I was 59 so I cud redeem with no penalty. The EXPIRATION wuz da penalty. Durn. Love to have them back.
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24HourForums.com > Supported Forums > 24's Money Business > Save and hurt now, or not, and hurt later! | ||||||||||||||||||||||||||||||||||||||||
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