I have credit card debts to pay off, student loans to service, bills to pay and a down payment to save up for. I can’t afford to save for retirement.
Sound familiar? With all these obligations, how the heck are we supposed to start saving for retirement, something that could be decades away?
In honor of the National Save for Retirement Week, let me tell you a secret that shouldn’t be a secret to begin with. When you can’t afford to save, you do it anyway.
Why Saving Anyway is Possible
Like you, I’ve contemplated on whether I should contribute to my retirement accounts this year. I just switched from having a full time job plus a side business to having just the income of the business. I also wanted to buy a home in the near future, and everyone could use a little more down payment.
Yet, I diligently added funds to my IRAs. I didn’t keep up because I think the stock market was heading north, nor was it because of some advanced saving technique. I contributed to my retirement account because the more I had access to, the more I would spend.
- The more down payment I had, the more house I’d want.
- The more I had in liquid assets, the more I would likely buy.
- The more income coming in, the more I’d likely splurge.
We have been looking to buy a house for a few years now, and we were fortunate that prices have come down to more affordable levels. What we could buy a few years ago cost roughly half as much, but instead of feeling like we could save some money, all we did was look at nicer homes. It wasn’t because we somehow needed more space, but simply because we could afford a bigger house.
The More We Could, The More We Want
Money in our savings is like food on the plate, we will consume more if we can see it and get to it. The more you contribute to your retirement funds, the less you will waste because you can always make due. It’s almost like magic but the less you have, the less you need.
Stop making excuses and start contributing already. In fact, contribute today and do it now. You will be glad you read this when you retire.
Editor's Note: I've begun tracking my assets through Personal Capital. I'm only using the free service so far and I no longer have to log into all the different accounts just to pull the numbers. And with a single screen showing all my assets, it's much easier to figure out when I need to rebalance or where I stand on the path to financial independence. They developed this pretty nifty 401K Fee Analyzer that will show you whether you are paying too much in fees, as well as an Investment Checkup tool to help determine whether your asset allocation fits your risk profile. The platform literally takes a few minutes to sign up and it's free to use by following this link here. For those trying to build wealth, Personal Capital is worth a look.
- E*TRADE IRA - Official Site