Do You Know Where Your Money Is?
I think it is amazing that so many people know how important it is to save for their retirement, and still when you ask them about their retirement funds they have no clue. They don’t know whether they are in stocks, bonds, or funds, they don’t know how much they are yielding, how much they are contributing or even how much money they have in there.
It is important that you not only begin saving for your retirement, but that you make the most of the money that you have invested in there. Right now the market is up and down, and although that has a few people sitting there hoping that they don’t lose anything, this is also a great time to get in on the ground floor of a company that will weather through the storm. Taking this opportunity to by some really good stock cheap is a wise move, and as long as you don’t need your money in the next few years, this really could be the opportunity you have been looking for to make your retirement fund grow in ways you never thought possible.
It is okay if you are unsure as to what you are doing. If you really don’t understand the whole thing, then seek out some financial advice. It is really important not only to save for your future, but also to take advantage of the opportunities that this current economy may be providing you with. It is a good idea to put money into your retirement, but if you have it sitting in a low interest fund, then you may not be making the most money that you can. It is time to look towards the future, and you can begin that process by first understanding your money and knowing where it is.
Plan for Retirement NOW
Well, if you are under forty, you may think all of this is something for you to think about in another ten or twenty years. However, if you are a WISE person under forty, you will pay attention to what I have to say.
OK. So here is the wisdom I need to share with you: IT IS NEVER TOO EARLY TO PLAN FOR RETIREMENT!!! PAY YOURSELF FIRST!!!
I can assume that many folks out there think that it will never become a problem to be able to retire comfortably. They will just pay off their home and live on their Social Security benefits. Social Security benefits alone will not get you very far and will not even keep up with inflation. Let me assure you that if you do not start planning for retirement before you are forty, it may be too late.
In my early 40s, after being a stay at home Mom of 20+ years, I found myself divorced and earning my own living. I did not benefit from the 20+ year marriage in ANY financial way whatsoever — I walked away with my children, a few kitchen utensils and some used furniture. And I know you are saying, but how does that apply to my life. Of course, your first and primary concern is to provide a roof over your head and food on the table. That is primary for all of us. But once you learn that you can do that and you work yourself up a little higher and a little higher on the income earning ladder, you will realize you must also provide for not only your present needs, but your future needs.
So here is where I come in with advice. In your work environment, as soon as you are allowed to begin investing into your retirement package — do it. With most retirement packages, you can start out with a minimum amount and then increase your investment up to a specified dollar figure or a percentage of your earnings. So do that — start out with the minimum. It is usually tax deferred dollars, so the minute you begin investing into the plan, you have made money. ANY amount of money you can afford to put into an account with pre-taxed dollars, do not blink, do not hesitate in any way whatsoever – invest it. Most often, your employer will be contributing at least a small percentage of that amount into that retirement fund also. And as that investment grows, it remains pre-taxed dollars (until you take it out).
If you do not have a retirement plan available where you work, by all means, seek out the advice of someone in the financial industry, whether it is your banker, your insurance company or an investment company. There are many other ways of using pre-taxed dollars to prepare for your retirement. No matter what type of employment you have, even if you are self-employed, find a reputable institution and begin investing in your own future.
If you are thirty-five to forty, you may still have some years that when you choose your investment categories, you may still choose to put that money into a moderate risk investment. Your return on your investment will be slightly higher with only a moderate risk of losing anything along the way. By the time you are fifty, my personal suggestion would be to move it to a more stable category. Your return will be slightly less, but your risk of losing anything will be practically nothing. Every dime you put in, even though it only makes a small return, will be there with no concern of loss. And the older you get, the fewer years you have to make up any losses you may experience in a moderate risk portfolio.
As the economic situation of our world changes, it becomes more and more important to plan to be able to take care of yourself in your retirement years than it ever has before. The pensions our grandparents received after being a loyal employee for all of those years are a thing of the past. Today, you dont even get that gold watch. If you do not make sure you will have enough to live on reasonably comfortably in those years when you can no longer work, no one else will either. Start now. Even with a small regular investment, you will be surprised how much it will grow and hopefully, you will be better prepared to enjoy those golden years.