This Could Be the Most Important Piece of Financial Advice You’ll Ever Get –

There are plenty of money-related lessons to be learned in life. The importance of following a budget is one of them, as is avoiding debt whenever possible. But when asked what the most important piece of financial advice would be to pass on to younger generations, Americans overwhelmingly agreed that it’s the need to save for retirement. That’s the latest from Comet, which also found that 43% of the folks they surveyed aren’t on track with their nest eggs.

If you’ve yet to start thinking about retirement, which may very well be the case if you’re younger, then consider this your wake-up call: The sooner you start planning and saving for this major milestone, the greater your chances of actually getting to leave the workforce when you want to and live a comfortable lifestyle in the years that follow.


Always have an eye on the future

Why is it so important to save for retirement? It’s simple: Social Security won’t be enough to sustain you when you’re older. In a best-case scenario, it will replace about 40% of your previous income, assuming you were an average earner. Most seniors, however, need about twice that amount to cover the bills, and that means it’s on you to come up with the rest by building a nest egg.

Thankfully, you have a number of choices when it comes to establishing long-term savings. If your employer offers a 401(k) plan, you can sign up and have a portion of each paycheck sent directly into savings. You can contribute up to $18,500 annually if you’re under 50, or $24,500 if you’re 50 or older, but if those thresholds sound unattainable to you, just do the best you can — it’s certainly better than nothing.

If you don’t have access to a 401(k), you can open an IRA through most financial institutions. The current annual contribution limits are much lower than those of a 401(k) — $5,500 for workers under 50, and $6,500 for those 50 and over. On the other hand, it’s easier to max out an IRA than a 401(k) because of these lower thresholds, and while both accounts offer a host of investment options, IRAs tend to come with a significantly wider ranger of choices than 401(k)s.

Speaking of investing, you’ll want to invest your savings wisely to ensure that your money grows. In this regard, stocks are truly your friend, especially when you’re young and have a long investment window ahead of you. If you’re iffy about putting your money into individual stocks, there’s always the option to go heavy on index funds. Not only are they a cost-effective option thanks to their low fees, but they’re also a good way to build a diversified portfolio without having to do the same amount of research individual stocks would normally require — though you should always research any investment you’re thinking of putting in your portfolio.

So now that all of the basics are out of the way, let’s talk money — specifically, how much of it you might accumulate if you start saving now. Check out the following table, which will give you an idea:

If You Start Saving $300 a Month at Age:

Here’s What You’ll Have by Age 65 (Assumes an Average Annual 8% Return):












The sooner you begin putting money away for retirement, the more it stands to grow. That’s because as your investments make money, you get a chance to reinvest those gains and kick-start a wealth accumulation cycle that will serve you well as a senior.

Now you’ll notice that the table assumes an 8% average annual return on investment. That’s just below the stock market’s historical average, which means that if you load up on stocks early on, you stand to do pretty well.

Here’s something else to take note of: The table assumes only a $300 monthly investment, which isn’t even close to maxing out an IRA, let alone a 401(k). If you’re able to do better — say, save $400 or $500 a month — you stand to amass even more of a nest egg.

Like it or not, your retirement isn’t going to fund itself, and if you wait too long to start saving for it, you’ll risk struggling financially later in life. On the other hand, if you commit to saving relatively early on, there’s a good chance you’ll wind up sitting pretty by the time your golden years roll around.

The $16,728 Social Security bonus most retirees completely overlook

If you’re like most Americans, you’re a few years (or more) behind on your retirement savings. But a handful of little-known “Social Security secrets” could help ensure a boost in your retirement income. For example: one easy trick could pay you as much as $16,728 more… each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we’re all after. Simply click here to discover how to learn more about these strategies.

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