Save now for later. Four reasons to save for retirement NOW!

Between your house, car, kids, pets and life, it’s REALLY hard to find extra cash, especially when it comes to saving for retirement. If you have any kinds of debt, your focus is always on paying those off.  However if you’re one of those lucky few who does not have consumer debt, you may need to start thinking about your future. As we live longer, our retirement dollars need to stretch even more.  If you’re in your 20s (yes, even if your 20s!), 30s and 40s, you need to pay attention. Take a look at four important reasons to start saving for retirement NOW!

  1. Save now and reap the benefits later

If you’re in your 20s and early 30s, you may be thinking you have time on your side. What’s a few dollars going to do for my retirement?  “I have plenty of time!” you think. However, even a couple bucks a month can go a long way. Investing small amounts now can add up to a significant amount of saving in the future because YOU HAVE TIME ON YOUR SIDE. How daunting do we sound right now?!

The benefits of time being on your side…..

  1. Compounding returns

Starting to save for retirement now allows your money time to grow. This in turn will generate new money and will continue to do so until you retire.

Let’s say Tolga started investing $100 a month when he was 25 years old until he turns 65, he would save $228,000 when he retires.

Lindsey, on the other hand waits until she’s 40 to start saving. However, she’s very established at this point and invests $300 a month (3 times the amount) for 25 years. Well, she would only have $225,000 when she retires. This is a mere difference of $3000.

Investing Early Example #1

Let’s really drive this point home.  Another example; Tolga invested the same $300 a month for 40 years, he would have $685,000. There is over $460k difference in how much his retirement would be with just investing an extra $54k than Lindsey! Poor Lindsey

Investing Early Example #2

  1. Improved spending habits

When people start investing in their retirement savings, they tend to develop and maintain positive spending habits. They are focused on not spending beyond their means to ensure that they can put away the funds needed.  The earlier you learn these lessons, the better you will be at managing your money for the future. Your 65 year old self will be so thankful!

  1. Save more now and adjust as life changes

We’ve touched on this before, but sometimes life can take a giant dump and things can become super shitty. Too graphic? Sorry! Anyways, as we’ve said before, it’s better to start saving now because life can change.  Whether it is job loss, long-term illness, divorce or other awful life circumstances, it can be harder to save when you’re barely making ends meat. By saving now, there will be less financial stress in the future. You might have to reallocate your money later in life but because you invested early by the time you are in your 40s or 50s, you can weather the storm much easier and your retirement nest egg will continue to grow.

Final example; if Tolga invested for ten years starting at twenty-five years old and after that he let his money grow for thirty years, he would have more money at retirement than if Lindsey invested for thirty years, starting at thirty-five years old.

Investing Early Example #3

We hope we haven’t scared the shit out of you. But like the saying goes, “no times like the present!” You need to start saving now, even if you’re older and maybe behind on the savings game. Perhaps you just work a little longer or adjust your current savings model. We just want people to be more aware of their savings and how a little time can go a long way.


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