I’m only 30 - why should I start thinking about retirement?
There's a lot that goes into planning for retirement. You have to think about how much money you'll need to maintain your lifestyle, how long you want to work, and when you want to retire. All of these factors can seem daunting, especially if you're still in your 20s or 30s and retirement is decades away!
But the truth is, the sooner you start saving for retirement, the better off you'll be. Here are three reasons why you should start thinking about retirement now:
1. The earlier you start saving, the more time your money has to grow.
If you start saving for retirement in your 20s or 30s, your money will have decades to grow. This is thanks to the power of compounding, which refers to the ability of an investment to generate returns not just on the original investment, but also on any previous gains. In other words, your money will grow at an exponential rate if you start saving early.
2. You'll be able to take advantage of employer matches or other benefits.
Many employers offer retirement benefits, such as matching contributions. If you don't start saving for retirement until later in life, you'll miss out on this free money. Employer matches can be an important part of saving for retirement, so it's best to take advantage of them as soon as possible.
3. You'll be less likely to have to rely on Social Security.
Social Security was never meant to be the sole source of income for retirees. In fact, it was only designed to replace about 40% of your pre-retirement income. If you want to maintain your standard of living in retirement, you'll need to supplement your Social Security benefits with other sources of income. The sooner you start saving for retirement, the less reliant you'll be on Social Security.
Saving for retirement may seem like a daunting task, but it's important to start as early as possible. By starting now, you'll be able to take advantage of the power of compounding and you'll be less likely to have to rely on Social Security. So don't wait, start saving for retirement today!
If you have questions about retirement, we’re happy to help you get started. Book a 30 minute call to discuss your retirement questions here: www.calendly.com/heysonder/intro