Starting to save for retirement is something that should be started when you are in your twenties. Some find it hard to start; others do not know where to start. Here are some tips for those in their twenties to get started with saving for retirement.
Look into accounts with compound interest. These accounts will add up much faster. If you start an account with compound interest when you are in your twenties, by the time you retire you can have quite a bit more. Most experts agree that if you want to have a lifestyle close to your pre-retirement lifestyle you will need to have nearly one million dollars saved before retirement.
Do your best to avoid any fees that come with bank accounts and credit cards. Over the course of your working life if you were to pay these fees every month it will add up to quite a bit. If you are able to avoid these fees then you can use that money to save for retirement.
If your company offers a 401(k) and are willing to contribute then you need to make sure that you are contributing the maximum amount that your company is willing to match. Some say that it is okay to put in any amount as long as the company will match it. That is nice, but it is best to contribute the maximum they are willing to contribute, this will give you more money at retirement.
Create an emergency fund. Having a separate savings account for emergencies than you have for your retirement savings is a very good idea. This way if something happens you are not using any of your retirement savings, instead you will be using money you have set aside just for that purpose. Most experts say that you will want to have an emergency savings account that has about six to nine months worth of income. If you have that much, then if you were to lose your income you would have money to make it through until you get another one.
When you are in your twenties it may feel strange to think about starting to save for retirement. It is much better to start now than later in life though. If you start now, you will build up much more interest than you will be able to make up for it later. You will be very happy later in life, especially around the time you are planning on retiring if you start saving while you are in your twenties. If you do not start saving now you could end up regretting it when you are getting ready to retire.
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