Why save for retirement? For many of us, it sounds so far away. Who knows what those days will hold? And in the meantime, we’ve got bills to pay and savings we need to put away for today.
Let’s face it, it’s hard to imagine what the heck you’ll want your life to look like in thirty years.
Retirement means something different to everyone. Some of us envision our later years being spent on the beach, volunteering, or traveling the world. Maybe we’d like to keep working — but just a little less.
Here’s what we all want: To be independent and have money for the unexpected things that can come up in later life. That’s where your retirement account comes in.
We know all the excuses for not saving for retirement. And we also know the important reasons for starting now:
“My parents didn’t save for retirement and they seem fine.”
Many of our parents had pensions or investment programs that they contributed to over the course of their careers. For many of us, that’s not the reality. Things are very different now.
- We’re living longer.
- We’ll probably be receiving less money from Social Security than previous generations.
- Our career paths are likely to be a lot more unpredictable.
- There’s uncertainty around what healthcare will look like in the future. This can make it tough to predict how we’ll be able to afford to take care ourselves if we get sick.
We can’t look to our parents as the model for retirement.
“I’m too young to be saving for retirement!”
Your 20s are a great time to begin thinking about retirement. In fact, the younger you are when you start saving, and the more consistently you save, the more you’ll have when you need it.
If you start putting $25 a week toward your retirement account in your 20s (contributing more as you get older and earn more money) you could have a lot more money available to you when you need it.
Time is your best friend when it comes to long–term saving.
“I’m too old, I missed the boat!”
Take a deep breath. It’s never too late to start saving for retirement. Yes, it’s true that it’s better to start when you’re younger, but not all of us knew to do it. That’s okay!
You may have to put more money away now to catch up. But don’t be discouraged. It’s a long road to retirement so don’t take yourself out of the race because you had a late start.
“Retirement? I’ve got bills to pay first.”
We get it. It’s hard to wrap your head around the idea that saving for something as seemingly far off as retirement is as important as that student loan bill or credit card payment.
Start small. Even just $15-$20 a week is a great start. Do what you can, as soon as you can. Putting this money aside may seem like a strain now but it’s important to take the long view.
“I’m never going to retire, I can’t imagine not working.”
According to a recent poll, nearly 40% of Americans believe they will retire after 65. Three quarters of us plan to work in into our retirement years.
Retirement doesn’t necessarily mean you have to stop working. In fact, most Americans say they’ll want to have some sort of job after the age of 65. And not because they think they’ll need the money, but because they want to keep active and engaged while earning some extra cash.
Saving for retirement doesn’t mean you’re saving for a time when you stop working. It’s creating a financial cushion for a time in our lives when there may be unforeseen challenges — and new opportunities for adventures.
No matter how you want to spend your later years, contributing to a retirement account is the best thing you can do for your future self.
Consider it a love letter filled with cash that you’ll open when you need it most.
Keep reading: What’s a Roth IRA? We Explain It
Lindsay Goldwert is Senior Editor at Stash.