Many of us do not understand the detrimental effects that failing to save for retirement can have on our lives. We are young and foolish and we don’t spend a great deal of time thinking about the future. This needs to change because it’s incredibly important to start saving for retirement as soon as you can.
Why? At some point in the future, you’re going to want to stop working. You might get sick or you might be sick and tired of going into the office, factory, or jobsite every day. Nevertheless, if you do not put enough money aside to support you during your retirement, you’ll have to continue to go to work until the day you die.
Does that sound like a good idea? Do yourself a favor and read the following reasons why it’s best to save for retirement started now:
- Social Security likely will not cover all of your expenses in retirement
- People live longer these days and need more money to survive and thrive
- It’s much easier to save for retirement then you may have been led to believe
- If you wait too long you’ll run out of time and regret not financially preparing for your twilight years
Continue reading below to learn about each of these benefits in greater detail.
Social Security Will Unlikely Pay All of Your Bills during Retirement
Ideally, by the time you reach 62-65 years old and decide to collect Social Security, this monthly payment will cover all of your day-to-day expenses. Unfortunately, this is very far from the truth for many Americans who find themselves in this position.
The sad fact is that too many Americans find themselves struggling to get by because they failed to save for retirement. They focused solely on collecting Social Security and found out that it wasn’t enough money to cover their expenses.
The worst part is many Americans are forced to choose between buying expensive medications or paying for food. In some cases, in order to put food on their table, there are retirees that choose to eat dog food and other animal foods because they don’t have enough money to pay for regular meals because their medications are too expensive.
On average, Social Security typically covers 40% of your previous income during your working years. More often than not, people have a hard-enough time getting by on their work income. Try to survive with 60% less? It’s going to be nearly impossible.
Instead of struggling and forcing yourself to make tough decisions, you can begin putting aside money for retirement right now. Set aside as much as you can afford and allow the interest to compound year after year until you’ve grown a very healthy retirement account.
People Live Much Longer Today Than They Have in the Past
You can thank the miracles of modern medicine and healthy eating and living for living longer lives. But the longer you live, the more money you’ll need to survive and thrive during your retirement.
Can you afford it without saving? Will your monthly Social Security payments cover your expenses? Do you have a pension to supplement your Social Security checks?
In all honesty, you’ll need some type of additional source of income in order to pay your bills once you finally decide to retire. Social Security isn’t enough and because people are living longer, most companies fail to provide their employees with pensions. It’s too expensive and the pensions will go on for too long because people regularly live into their 80s and 90s these days.
Think about that for a second. If you decide to retire at 65, it’s possible you may live for another 25-30 years. Will you have enough money to last? Or will you need to take on a part-time job in order to supplement your income.
Instead of worrying about this potential struggle, you can start saving for your retirement right now and grow a healthy nest egg in the process.
Saving for Retirement Is A Lot Easier Than You Think
For some reason, people believe that they need to put aside 60%-70% of their paycheck in order to save for retirement. This is very logical but it’s a fallacy nonetheless.
Did you know that you could save $6000 per year in an IRA account? If you were to do this for 25-30 years, you’d be a millionaire by the time you retired.
Imagine having more than $1 million available to you when you turn 65? If you play your cards right, you could spend $40,000 a year for the next 25 years and your retirement savings plus Social Security will pay all of your expenses until the day that you expire.
Wouldn’t that be amazing? You’ll never have to worry about money again in your golden years.
Don’t Wait Too Long and Regret Not Saving for Retirement
One of the biggest regrets that I hear from retirees is that they failed to put money aside when they retire. Most of these people aren’t broke, but they just didn’t actively save to build a healthy retirement account for themselves and their families.
Now, instead of waking up in the morning and going out to breakfast, or a walk, or doing something else they enjoy, they need to put on their work uniform and go to the local supermarket to bag groceries for the next five hours.
Does that sound like the ideal retirement to you? Do not sell yourself short by failing to put aside savings for this special time in your life. Put money in a 401(k) or IRA account now and make regular contributions so you can build up your nest egg for the inevitable time when you finally decide to call it quits at work for good.
Saving for retirement doesn’t need to be a difficult process. If you start young and have the money automatically deducted from your paycheck, you’ll likely not miss it. Even better, you’ll have enough money to live comfortably during your golden years. Doesn’t that sound nice? Do not wait too long to start saving because you’ll have major regrets. Get started now and live comfortably without working in the future.