I am 24, and don't have much money saved yet. I am worried that when I get older, I won't have saved enough money to live off. My college Professor told us that we should have already gotten started saving up money for retirement. I'm very good at budgeting, paying bills on time, and handling money....but I just have not done well as far as my savings go, and don't feel like I have enough saved. Have I waited too late? What can I do to jump start my savings?
2006-10-30 02:57:30 · 7 answers · asked by LibraT 4 in Business & Finance ➔ Personal Finance
The truth is every time you go to the bank you should buy a U.S. savings bond. $37.50 for a face value of $50.00. The reason is because they can grow tax deferred and it creates a consistency pattern in your savings that you can track. They pay interest for 40 years. Which turns out to be just about right for your retirement age. It is never too late to start. Invest in America.
2006-10-30 03:26:39 · answer #1 · answered by Jessica M 4 · 0⤊ 0⤋
You're no where near too late-- but why not start now? I'm 23 and I have 8,000 in my retirement fund already.
If you look at the facts, I can put $25 a month into an account and a person who is 40 years old and is just starting could put $200/month into an account and I'll STILL have more to retire with than they will. Becuase I'm making interest on my interest. For the next 40 years.
TIME is power. Call up a good financial officer or check out companies like http://www.principal.com/index.shtm or https://401k.fidelity.com/ and see if you can set up an automatic payment of $25 a month or so. Get started!! :-D
2006-10-30 11:45:12 · answer #2 · answered by Anonymous · 0⤊ 0⤋
Hi Libra. I'm also a Libra (9/26).
24 is a great year to start saving. Here's the easiest way to do it:
1) Make sure you have paid off all consumer debt first! High interest payments are your first thing to tackle! You should also have a 3-6 month emergency fund in a high interest savings account (try Citigroup online).
2) Invest in your company's 401(k). You need to put in as much money as your company will match you for. So, if they match 50 cents on the $1 up to 5% of your salary - you need to put in 5%. That way you get a "free" 2.5%!
3) Invest the maximum in a Roth IRA. For 2006, I think this is $4000. You have until 4-15-07 to save for 2006 (in case you need to catch up on 2006). A Roth IRA is a good tool for those that are in a lower tax bracket becuase savings are made after taxes, grow tax free, and are not taxed when you withdraw (at 59 1/2 or older). You can set this up to withdraw a monthly sum from your bank account - say right after you get your paycheck! To save $4000 a year, that's $333 a month.
http://beginnersinvest.about.com/cs/iras/a/iracontribution.htm
4) If you have any additional money left that you can budget to save, I suggest you increase your % to your 401(k). If you dn't have one, sign up for an Automatic Asset Builder to withdraw the money and put it into a mutual fund each month.
Put your money 50% in a blended Large Cap fund, 35% blended Small Cap fund, and 15% in International Fund.
I reccommend T Rowe Price. They have low fees, no load funds (fees paid to buy a mutual fund), and have great customer service. Check them out and see if theres one near you with a customer service center. Make an appointment and they'll set you right up.
2006-10-30 14:11:35 · answer #3 · answered by Amy W 1 · 0⤊ 0⤋
If your company has a 401K, start contributing to that. If not, then a Roth IRA is the next best thing. Invest in S&P or Total Stock Market Index Mutual funds (e.g. Vanguard funds) at first. Since you are 24, you have 40 years to retire and plenty of time.
2006-10-30 23:41:04 · answer #4 · answered by Steve R 6 · 0⤊ 0⤋
401K plan to start when your employed, its a great way to start most companies match a certain percentage of the savings. Something simple you can do at home, all your change in a jar, every night. By year end you would be surprised how much you can save I have average $1,000 a year then throw it into a cd - usually yields a higer percentage than a savings account. Simple things can work wonders.
2006-10-30 11:06:28 · answer #5 · answered by HereweGO 5 · 0⤊ 0⤋
Contact a personal financial advisor as soon as possible. He/she should set you up with a mutal fund based retirement plan. You have the advantage of being young. If your employer offers a 401k plan, join it and invest a minimum of what ever they will match.
2006-10-30 11:01:39 · answer #6 · answered by Two dimes and a Nickel 5 · 0⤊ 0⤋
just start now u will be find and I'm sure you will save enough to live on. plus just marry rich. good luck with whatevery u do.
2006-10-30 11:11:08 · answer #7 · answered by LadyBoss 3 · 0⤊ 0⤋