We are in a free fall economic climate; start saving for retirement now.
We are in a free fall economic climate; start saving for retirement now.
With the economy in what seems like free fall and more individuals talking about how important it is to save and plan ahead, a lot of people are realizing they need to start thinking about retirement plans right now.
The reality is that you may increase your retirement savings by starting to plan and save earlier in life.
Particularly among the young and unmarried, few will begin saving for retirement plans today.
Having said that, the optimal time to begin saving for retirement is when you are young and unmarried.
The two most important causes of this are: There is a clear rationale for this: the longer you put money away, the more you'll have.
It will be a relief to know that you are prepared to retire and can enjoy a comfortable life once it arrives.
Additionally, when one's expenses are low, it becomes more natural to save money and create (and adhere to) a budget.
If you want to establish the habit of saving for retirement, it may be easier if you start early, before you get married, have kids, and have to worry about paying for college.
As they get closer to retirement age, many people realize their error and begin to really consider saving for it.
Unfortunately, they will have a plethora of other commitments and considerably less time to save up during that period.
Thus, I believe we have proven that beginning earlier is preferable.
Never "hope for the best" when you hand over your money to a financial planner; that's another crucial consideration.
Numerous individuals have done that, and as a result, a significant portion of their retirement funds have been lost.
"Invest for the long term" and "recoup your investments when the market rebounds" are the conventional wisdoms, you know.
However, that reasoning is severely flawed in two key areas:
1. It's possible that you won't have enough time to earn back your investments and savings before you retire.
What if, in the years or months leading up to your retirement, you saw half of your investment portfolio evaporate? How would you feel about that?
What follows then? Will you continue working? Have you ever hoped for the best and retired on schedule? Do you decide to live with your adult children?
2. Very few extremely rich and successful investors see a significant loss of their assets when market prices decline.
What gives? As a matter of fact, many of them have some degree of expertise and include them in their investment team.
They will transfer a large portion of their money to safer investments as soon as they detect a decline in the markets.
That way, even if the market crashes, their money will be in a secure location.
They haven't lost much, if any, of their initial investment, so they don't even need to recover it.
Moreover, despite the market downturn, their assets kept growing in numerous instances!
Smart investors are really reaping the benefits of the current market slump, while millions of people are frantically trying to recover their losses—a task that might take years.
As you begin to prepare for retirement now, remember all of this information.
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