The Age of Retirement
The Benefits of Starting Young
- You’ll waste less money. Individuals who are committed to specific retirement savings goals budget better and spend less on frivolous things. If you hone this habit at a young age, you’re also more likely to hang out with others who do as well—perhaps even a future mate with similar habits and long-term financial goals.
- You’ll have more confidence. There’s nothing like financial vulnerability to suppress the courage to take risks and try new things. Having a financial cushion will give you the confidence to pursue your dreams in both your personal and professional life when you see the chance to go for it.
- You’ll have better quality of life. Financial stress can be the root of unhappiness in many ways—including relationship troubles, issues at work, and negative effects on your health. By learning to save early in life, you’ll have a better shot at a balanced life that isn’t constantly strained by a shortage of cash.
- If you’re in your twenties: Make the most of time, since it’s definitely on your side. If you start now, you’ll need to save a lower percentage of your paycheck to get the same or better results than if you start even a decade later.
- If you’re in your thirties: Experts recommend considering a Roth IRA to make the most of saving at a young age—with the power of tax-free growth over a 30-year time frame.
- If you’re in your forties: You might want to consider consolidating retirement plans you’ve accumulated to this point into a single plan through your employer or through an IRA rollover.
- If you’re in your fifties and beyond: It’s time to play catch-up and make the most of how the IRS allows you to do it—with additional contributions permitted to IRAs and 401K plans.