Here Is Why You Should Start Saving For Retirement As Soon As You Enter The Workforce
It’s easy to put off saving for retirement, especially for those under 40. After all, when you’re 25-years-old and living the life of freedom and excitement, it might be hard to imagine one day having a family to support, kids to put through college, and weddings to pay for. But the day that will inevitably come where you are no longer bringing home a paycheck to pay for all of these things. So, while saving for retirement might seem like a distant need, in the blink of an eye, the day you retire will be here, and you’ll be thankful for those decades you spent saving.
It’s a scary statistic: according to CNBC, 65 percent of Americans save little or nothing for retirement. A sobering statistic even more, 19 percent of Americans put zero dollars a year toward retirement. It’s alarming to think about… especially when the media is constantly saying (perhaps exaggerating) that in a few short years, Social Security won’t be around. In fact, this belief is being circulated so widely that 80 percent of millennials fear they will never reap the benefits of Social Security. Economists refute the claim that Social Security won’t exist for millennials, but do repeat that, nonetheless, millennials should be saving for retirement, as with expected budget cuts, Social Security percentages will go down.
There is currently a very low unemployment rate, but still, many Americans live paycheck to paycheck. Remember that even saving a few dollars here and a few dollars there can help out tremendously in the long run.
How Much Should You Save?
If you’re unsure of what you should be saving, use a retirement calculator. The general rule of thumb is to save fifteen percent of your annual take home pay. To many, though, that is a lot of money. Coming up with the money — or any money at all — might require a hard and sincere combing through of your finances. Maybe it’s time to cut back on the daily trip to Starbucks or your quarterly vacation. Saving for retirement shouldn’t be painful, it should be something that gives you comfort, knowing that because of your decisions today, you will be taken care of in the future.
Too often, young people are passive about retirement, but they shouldn’t be. Even to put off saving for retirement until 30 or 40 is now considered to be a late start. As it stands now, full Social Security benefits are not granted until the age of 66. Soon, though, that number will be raised to 67. It’s logical, then, to believe that in the next 30-40 years, that number could raise drastically, especially given the advancements in health and technology.
It might not be the most exciting thing on your to-do list, but make sure to pencil in an appointment to comb through your finances and start saving, even enlisting some expert assistance, like Secure Choice, to go the extra mile. Your future self will thank you!