Why save for retirement while you’re young? To avoid eating cat food in your old age!

Why should you save for retirement while you’re still young? Retirement is far away. A short answer: Save for retirement, so you’re not working at age 81 and eating cat food. That’s not politically correct, but it’s a stark reality.  

  

Save for Retirement to Continue Living Comfortably

 To continue living comfortably after you stop working, you typically need cash in the bank, a spouse supporting you, or your children taking care of you. (Do you really want your kids paying your bills?)

 Don’t expect Social Security to take care of you. My projected annual social security income is $22,000! Read that again. $22,000 per year.  I’m going to live fabulously until the day I die. $22,000 ain’t gonna cut it!

I plan to have a mix of cash and investments so I can travel the world, buy the grandkids presents, and enjoy wine! I don’t want to live great in my youth then suffer when I’m old. I’d rather balance it (called lifestyle balancing) so I’m comfortable all of my life.

Picture Your Lifestyle in Retirement

Developing a picture of the lifestyle you want in retirement makes it real and gives you a more concrete goal. You don’t need to know all the details . . . just, step back and think big picture . . . . How do you want to spend your time? Volunteering? Traveling? Hanging with family? Now, stop reading, and picture your fabulous lifestyle in retirement.

 

Save Enough to Achieve that Lifestyle

Once you have a vision of your fabulous self in retirement, you start saving! If retirement calculators don’t make your eyes glaze over, use one—either online or through your 401K or IRA provider—to see how much you’ll have annually at retirement with your current savings percentage and investment strategy.

 

Use the KISS Principle for Retirement Savings

If a retirement calculator seems overwhelming, which is true for most people, then use the KISS principle (Keep it Simple, Stupid). Experts recommend you save 10 – 15% of your gross income for retirement each year. (When someone asks you how much you make, the number most people give is their gross salary.)

Next time you hear people fretting about how much to save for retirement, feel confident that you’re on the right track by saving 10 – 15% of your gross income. Your stocking away enough money to stay fly even when you’re old.

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What percent of your income do you save for retirement? What other retirement questions do you have? You’re thoughts and questions—not mine—are the most important. What else do you want to know?

 

 

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3 responses to this post.

  1. [...] Why save for retirement while you’re young? To avoid eating cat food in your old age! « Financial… [...]

    Reply

  2. Posted by Eli Johnson on May 12, 2011 at 10:08 pm

    Why do assume everyone wants a traditional life, including retirement, kids, etc?

    What is wrong with living a fabulous, interesting, short life full of experiences, travel, good sex, better food, and adventure? I would trade a short, full life, for a mediocre, long one any day of the week.

    Bragging about how much you have saved for retirement @ an early age is lame. That desk job and those lame travels are nothing to brag about. Having traveled the world three times before 30 was worth every penny. And who says you’ll be in good enough health to travel when you are 65? Good luck with that but medicine isn’t going to leap forward at the speed of light. They can’t cure cancer, AIDS, etc. yet! So what makes you think it’ll change in 30 years?

    And that “age is state” of mind crap is HILARIOUS. Those 60 year olds couldn’t keep up with us when I was in my 20s or 30s for that matter, so don’t kid yourselves. Youth much less life shouldn’t be spent sitting in a cubicle waiting/saving for a great life in your later years. You’ll regret not having taken risks when you were younger. And you can’t buy back excellent health no matter how much you have saved for retirement. You are just saving to die well. How effed up is that?

    Just my $.02…

    Reply

    • Hi Eli,

      Thanks for checking out Financially Fab. Even if it wasn’t your style, at least you read a post.

      Financially Fab is about enjoying life in a way that doesn’t leave you penniless, in debt, stressed out about bills, or unable to financially care for yourself. If your game plan’s different, that’s fine! Financially Fab is for folks that share its philosophy. If you believe in part of the philosophy, keep reading. If not, life is too short to read posts you don’t like.

      -Yvette

      Reply

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