Saving for retirement without living like a pauper or winning the lottery
Restored from the Empower Network archive (2011–2017), lightly edited to meet our current advertising standards. Views are the original author’s.
You might have had opened the tab of this one because it is an interesting topic, and yes you are right, it is indeed interesting.
I find interest in it myself, though I am a future foreseer but not to the extent that I get to have my retirement funds, funny though, we always seem to dream of growing up, yet never did we picture ourselves ‘that’ old if you know what I mean. We have dreamt of having a family, stable jobs, a house and a car of our own, but does saving for retirement really traversed our minds?
Ah! Now did not that get you thinking?
Actually, it is very apparent in media nowadays, in the newspapers, magazines and the telecasts that everyone is telling anyone to save for their retirements. Why is that? you might ask, well to be able to live financially stable silly!
So, put yourself in that age now and imagine, are you saving enough for retirement that makes you not live like a pauper? But also not like you won a lottery? You have to know that even when you are at that age and are living a very extravagant life that would just wound you up getting sicker. That is because you might be so used to that fancy life that you choose not to lift a finger or move a muscle anymore.
Let us go back to our imagination shall we? But this time let us be on a time travel, let us just presume that we did get all our aspirations in Life, like the house, cars, family and et cetera, and now, our children are growing up and we are on the verge of saving for something rather than our children’s tuition fees. How would we save for our soon to be retirement?
One-way would be to contribute to our employer’s 401k up to the match, why is that? Because if our employer matches the first 3% of our contributions in our 401k then our contribution would make our employers give us an additional 3% for free. Imagining it? If we keep up with this first step, what would we do next?
Second step? Do we mind opening a Roth IRA and let our salaries’ 10% automatically go to it each month? No, of course not! We all know retirement could be costly right? We need all the savings we can afford to make. We know that we will not be able to notice that money coming into that funds, I mean, let us just say you paid that money for the needs of your grown-up child.
Lastly, as we are almost right there, we must increase the amount we are saving for retirement by at least 1% each year, yes, as we are thinking to ourselves, just at least 1% each year, because this would entail that along with the Roth IRA and 401k then we can choose the certain contribution amount to increase also annually. Let us also assume that we are maxing out our Roth IRA. And we got it done! Sooner or later when we really reach that point in life, we would not have to worry anymore because we prepared for it long before, now is not that cool?
Snap. And we are back on the present, this time traveling really taught us how to save for our retirement without living like a pauper nor winning a lottery. At least this time we cannot seem to deny that we will grow old. Ah! Now, did not that just get out of your mind?
Join the forces of Evil? —–>