When entering the job market out of college, the concept of retirement seems like a lifetime away. Most people can’t even fathom thinking about retirement let alone save for it. And others know the day is coming, but they are relaxed in the notion that it’s too early to even begin thinking about saving for retirement.
Such thinking is certainly misguided. Regardless of the confusing retirement savings types, retirement is a natural part of life. It can be a wonderful experience for many families, especially those who planned early. It’s a new chapter in life, where people get to enjoy the fruits of their labor for the next few decades.
When money is carefully saved and invested, it can emerge to be a sizeable nest egg. Such savings will bring peace of mind to you when the reality of retirement hits. It means having enough money to take care of your housing, vacations, bills and unexpected expenses. You know, what retirement is supposed to be about. With that said, here is your step-by-step guide to saving for retirement!
It’s easy to get caught up in all the terminology associated with retirement. People get confused about retirement account types, potential tax benefits, choice of investments and other details. Trust me, it’s even hard for me as a Certified Financial Planner® to keep up with everything.
But the most important step you can take in saving for retirement is to actually begin – seriously. And, contrary to what some people think, it’s never too early to start. In fact, those who begin saving for retirement in their 20s have a much better chance of comfortably growing their nest egg in the coming decades – que the power of compound interest.
Trust me, saving for retirement in your 20’s is much better than starting to save for retirement in your 30’s, 40’s or 50’s. Keep reading and we’ll show you why.
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