Consistent, dedicated saving might not be glamorous, but it will give you far more freedom and control over your lifestyle down the road.
Social Security shouldn’t be your only retirement plan
Social Security was never meant to be anyone’s sole source of retirement income.
In fact, a 30-year-old making $50,000 per year today…and who might realistically expect to make substantially more by the time he or she retires…can expect less than $22,000 per year from Social Security at age 67 (in today’s dollars). That’s not much income at all if you expect to do anything at all!
In the past, pensions often offered an additional source of income for retirees. But pension plans are becoming rare in today’s world, and it’s more important than ever to take advantage of the opportunity to save for your future.
Keep in mind:
On average, Social Security payments make up only about 38% of Americans’ retirement income.
Source: Social Security Administration.
Spending now could mean you’ll pay for it later
Perhaps you’d rather spend your money on other things that are more fun than saving for retirement. I’m sure we’ve all made that decision over and over during our lives.
But because COMPOUNDING can GREATLY INCREASE the value of your savings, the “pain” of each dollar you save now can be greatly outweighed by the flexibility you gain later!
Of course, I’m not suggesting you’d be better off squeezing the last drop of enjoyment from your life.
But I think that knowing you’ll be all set to meet your basic needs later…..with enough left over to let you comfortably do the things you look forward to in retirement…..is worth going without a few treats now and then.
Do the math:
Choosing to spend less on certain things now could make a huge impact in the long run! For example, you could spend $3,600 a year on payments for a new car during the next 5 years … or you could watch that money grow to $80,000 over the next 40 years! That’s some SERIOUS GROWTH! But hopefully you won’t be in the RAT RACE for 40 years. Get BADASS about saving and retire in 10-20!!
Control what you can
In the end, the future of Social Security isn’t the only thing that’s out of your hands. Tax rates will almost certainly change between now and your retirement date, and inflation will continue to increase prices over time. Other government programs, like Medicare, might also change. So we must PREPARE by SAVING ourselves!
But there’s one thing that only you can completely control: how much you save. Start now and you might be surprised at how little you notice the sacrifice.
What do others do?
I read a recent report by Vanguard that found that 39% of employees under age 25 were enrolled in their workplace retirement plans. That’s fair but we need to do better!
Saving doesn’t have to be boring and depriving
Right now, you are probably thinking, “saving money is NOT fun.”
However, I want to tell you that you are wrong!
Maybe you are not into saving money as much as I am, but there are plenty of ways to learn how to make saving money fun. Learning to have fun saving money is always a good idea, because it can help you save more money! That means more you can INVEST!
So many people get tired of paying off debt and saving money, because it can feel so monotonous or they just lack the motivation.
This is why I believe the best way to save money is to learn how to make saving money fun. This can help keep you motivated and interested in saving money.
Below are some great tips on how to make saving money fun. Enjoy!
Challenging yourself to save more money is great, because it can help keep your financial goal on your mind and keep you motivated!
Some ways you can challenge yourself to make saving money fun include:
- Challenge yourself to beat spending areas you constantly struggle with. You could try to spend less money on gas, food, utilities, and more. It’s really EASY!
- Whenever you do spend money on a “want,” you can put that same amount of money into your savings account. So, if you buy a $35 clothing item, then you need to also put $35 towards savings or debt. This will make things seem much more expensive, so you are likely to spend less! Try this! It works!
- Take part in a no spend challenge. Read more about this in the section below.
Take part in a no spend challenge.
To some people, a no spend challenge may not be the most fun thing in the world. However, they can be a great way to let your creative side come out, because you will have to make do with what you already have.
You can do a challenge where you don’t buy any clothing, pantry food items, coffee, gas, and so on.
Now, you may be wondering how a no spend challenge can help you, so here’s how:
- No spend challenges can prevent impulse spending.
- You will find use in the items you already have.
- A no spend challenge can motivate a person.
- It can make you aware of your spending problems.
- It can er by making it a challenge between you and someone else. You can turn it into a fun challenge between your friends, family members, or coworkers.
Think of this as similar to when a person has a weight loss buddy. By having someone rooting you on, who is also going through both the good and bad times, you may be more likely to reach your financial goals.
You can compete with others to see who can save the most money, who can go the longest without buying a certain item, who can pay off debt first, and more. This also works very well! Save!! You can do it!
Read personal finance blogs.
I’m not just saying this because SAVING GEORGE is one. Some really good ones are… Budgetsaresexy.com, Mrmoneymustache.com, Listenmoneymatters.com, Makingsenseofcents.com, Getrichslowly.com, and Affordanything.com. These are great sources of information and motivational!
I truly believe that reading personal finance blogs and listening to podcasts can help keep you interested in saving money. Personal finance blogs are great for seeing how other real people are doing with their financial goals, to introduce you to things you haven’t thought of, and for possibly joining a community of others who have similar goals as yours. It really does KEEP ME MOTIVATED!
Make your financial goal visual.
Making your goal visual is a great way to find motivation and make saving money fun.
Having your financial goal displayed in front of you can make it that much more real, plus it’s nice to have a constant reminder of what you’re working towards.
Various ways to make your financial goal visual include:
- Start a blog. Blogging greatly helped me with my financial goals, because I could easily look back to see how I was doing, and the blogging community was very supportive. Plus, I felt like I had to keep myself accountable and kept improving because everything was public.
- Keep track of your NET WORTH! This shows you EXACTLY where your progress is or lack of.