Is It Too Early to Plan for Retirement? When is the Best Time to Start?
When you just finish college or university and get your first real job out in the workforce, retirement seems like a lifetime away. Likely you are more concerned about things like purchasing your first car, saving for your first home, and probably paying off your student debt. Those just starting out often think it’s too early to start saving for retirement, and that they have plenty of time to do so.
But what do the experts have to say? When is the best time to start planning and saving for your retirement? Is it best to start early, or can you afford to wait? Let’s take a closer look.
Speak to a Financial Adviser
Because most of us aren’t professionals when it comes to financial matters, the first step should always be to speak to a knowledgeable and experienced financial adviser. A financial adviser will be able to listen to your goals and help you lay out a realistic way to achieve them financially. Perhaps you want to retire early, then your plan will take this into account. Maybe you want to retire at the typical age, but want to be able to travel regularly, afford a house, and a car. Again, a plan can be laid out.
There’s No Such Thing as “Too Early”
According to most experts, there is no such thing as “too early” when it comes to saving for retirement. In fact, the ideal age to start according to the experts is your early 20s, right when you’re starting out in adult life. The reasoning behind this is very simple, the longer you save, the more your money will have a chance to grow.
You don’t have to save tons of money right from the start, some is better than none. This is another common misconception that young people have. They figure since they can’t afford to put away much, it’s just not worth it. This couldn’t be further from the truth, though. That money will sit in there that much longer, growing and collecting interest for you, making it very valuable in the end.
Depending on how you save and what you put your savings in, if you start when you’re 20 you may be able to stop by the time you’re 35 years old. Just imagine being completely finished saving for retirement at age 35? How freeing would that be? Again, this is where a financial adviser can come in handy and help direct you on an ideal savings path.
Make Smart Investments
Of course, you can also think about the investments that you can make now, in your early 20s, that will pay off in your retirement years. These investments could be in stocks, bonds, or even land/property if your budget allows.
Start on the Path Today
So, it seems that there really is no time like the present to get started on saving for your retirement, which will help ensure your retirement years are comfortable and worry-free when it comes to finances.