- September 28, 2021
- Posted by: Sushil Kumar
- Category: Budget and Goals
There are several reasons to start saving money: Are you planning to buy a new car? Do you want to create your own business? Do you dream with having a beautiful big house to bring your children up? Would you love to send your son or daughter to study abroad? Are you thinking about your retirement? If you answered ‘yes’ to any of these questions it means you have a great motivation to start doing it!
If you are in your twenties, you are beginning your adult life and maybe you are planning to save money because you have many other goals to achieve before even start thinking about retirement. But, what if you are getting to your 50’s or 60’s and you don’t have yet the money for your elder years? Maybe you could start getting a little concerned… The good news is: you shouldn’t be! You should get down to work and start saving. It’s not too late! Every penny you deposit in your saving account will get you closer to a calm retirement, which means, a more comfortable future.
Set Your Goals and Make a Plan
To start, you need to set your objective/s and identify how much money you are going to need to achieve it/them. Afterwards, you just have to create a realistic plan and to follow. For example, you can set a fix amount of money you will deposit monthly in your saving account or you could check your expenses and identify which of them you could reduce or eliminate; that money could be directed to your savings.
Likewise, you should inform yourself about the saving plans that will allow you to tax break. For example, maybe the company your work for offers you a contributions plan such as 401(k). Another option could be an Individual Retirement Account (IRA) that you could open by yourself in any bank of your trust.
Regardless the age, this is the first step to follow when we are talking about putting away money. Also, you should keep in mind that disorganization and overspends are enemies of savings.
“It’s not too late! Every penny you deposit in your saving account will get you closer to a calm retirement, which means, a more comfortable future”
Subsequently, how could you start saving for your retirement?
There are some recommendations to follow in order to optimize your saving strategy:
- Look over your retirement idea: Maybe you would have loved to spend your elder years in a Caribbean island, but that plan could not be quite realistic at the moment, so you need to think about a new way to spend those years. Perhaps, you will have to make some changes in your lifestyle; you will have to move with some relatives or to a cheaper household. Also, consider the possibility of working longer (instead of retiring at 65, you could continue until 70) or finding a mid-time or a freelance job you could do after you retired.
- Seek counsel to make a better saving plan: There are some free calculators online (see the calculators that Premier Consumer puts at your disposal, here) that could help you determine the amount of money you will need to save. Having that in mind, you can develop the plan to follow. If you don’t know how to do it by yourself, you could contact a financial coach; together, you could define which will be the strategies to follow in order to achieve your goal.
- Reduce expenses: Record all your monthly expenses and identify which ones you can reduce or eliminate: can you change your Satellite TV package for a cheaper one? Are there any active subscriptions (magazine, gym…) that you aren’t using and you could cancel? Direct all that money to your saving account.
- Pay debts: One of the biggest leaks of money people usually have is through arrears. Paying credits and other debts will be also a great strategy in order to save more money; the fastest you pay what you owe, more money you will have to put into your saving account. To determine an effective payment plan, you could also contact a financial coach.
- Avoid taking risk: When you are near to your retirement age, it is not a good idea to take big risks when investing your money, even if the profit is promising. Why? Because if you risk big, you can also lose big. At this time, it will be better to have a little less but to be sure you have it, instead of dreaming about having much more and end up with nothing.
- Try to get extra money: Any bonus or inheritance you receive, or any extra money you make working as a freelancer, for example, you should also put it into your saving account.
- Work longer and take advantage of the Social Security: According to the Daily Worth, if you work until you are 70 years old, you could receive payments of 132% of your full retirement benefit. On the other hand, if you work until 65, you will get only 70 or 75% of your full benefit. As consequence, if you postpone claiming, you will get a bigger support from the government when you need it the most. Another advantage of working longer is that you will have more time to put away money in your own saving account.
It’s not too late, but don’t delay
Don’t wait until next year, next trimester or next month. Start saving right now especially if you are feeling concerned. It doesn’t matter if you begin with small amounts of money or little measures (as putting each one-dollar bill you have away in a piggy bank) but don’t wait any longer; every action you take regarding your savings will sum to your future.