The best time to start saving for retirement is yesterday; the second best time is today. The worst time is putting it off till tomorrow. If you are young and wondering when to save for retirement, it might seem so far away that putting money away now seems premature. Even if you do not earn a lot of money right now, putting some money toward retirement now saves you from having to put a lot more away in the future. Thanks to the power of compound interest, individuals of any age can benefit from saving for retirement as soon as they can.
To understand why it is important to save for retirement as soon as possible, you first have to grasp the concept of compound interest.
What is compound interest?
Put simply, compound interest is the interest that is accumulated on the principal as well as accumulated interest over time. This means that the longer you allow a retirement fund like a traditional or Roth IRA to grow with compound interest, the greater your positive returns will be.
A CFP® professional can help you determine the best retirement fund options for your individual financial situation. These professional financial planners can help you gain a better understanding of compound interest, and how you can leverage it today to guarantee your retirement in the future.
When to save for retirement and the advantage of starting early
The sooner you can save for retirement, the better off you will be. Not only because compound interest can lead to greater positive returns over time, but also because of the potential for future liabilities to get in the way of saving money. If you are young, then you likely have fewer expenses than you may otherwise have down the road like a mortgage or familial costs. Time is on your side in your 20s and even your 30s.
After getting into a well-paying job, it may be tempting to neglect your retirement fund in favor of other more immediate purchases. However, our CERTIFIED FINANCIAL PLANNER™ professionals at ProVise can help map out your financial future and meet your personal goals.
Talk to a ProVise CFP® professional about your retirement planning
At ProVise Management Group, our CERTIFIED FINANCIAL PLANNER™ professionals can get to know you and your current financial circumstances, goals, risk tolerance and personal values to help you develop a plan that works for you. We can also create a written plan for you at a fiduciary standard of care. All our written plans come with an unconditional money-back guarantee. If you are unhappy with your written plan, you can return it to us, and we will refund 100% of the fee paid.
Are you ready to talk to a professional about saving for retirement? Contact ProVise today to schedule a complimentary consultation.