A little saving goes a long way!
Do you have a million dollars? At the moment, probably not. But if you invest and save diligently and let your assets compound, who knows? You may be a millionaire someday. In fact, you may need to be a millionaire someday. If you stay retired for 20 or 30 years – which could happen – it could take well over $1 million to fund that retirement. In fact, a recent study of Registered Investment Advisors recommended retirement assets of $1.5 million or more for baby boomers. This is why you should save regularly.
Your retirement savings accounts are your friend. For years, employers have wondered: why don’t people contribute more to their retirement accounts? At the typical large company, the majority of employees contribute too little, and some find it a hassle to even fill out the paperwork. Most people don’t speak “financial” and don’t look at financial magazines or websites. It’s “boring.” So they mentally file “retirement” under “boring.” But the advantages of saving early and often should not bore you; it should motivate you.
Tax-favored growth and compounding. The money in your retirement accounts compound year after year without tax penalties. The earlier you start, the more compounding you get. Let’s say you put $2,400 annually in an account starting at age 30, and for the sake of example, let’s assume you get an 8% annual return. How much money would you have at 65? You would have a retirement nest egg of $437,148 from putting in $200 per month. But if you started putting in that $200 a month five years later, you would have only $285,588.
Potential matching contributions. Who would turn down free money? Big companies will often match an employee’s retirement contributions. Usually, the corporate match is 50¢ for each dollar up to 6% of your salary.
Why not take advantage? If you don’t contribute greatly to your accounts today, you are ignoring a great retirement savings opportunity. Let’s talk and figure out a few ways for you to get started! Give me a call at 866-594-9919 for a FREE 30 minute consultation!