Saving for retirement is as simple as putting money into your savings account – and then not withdrawing anything.
However, you might be wanting to create a habit of saving.
Start with $10 a paycheck
It might not seem like a lot, but $10 saved per paycheck is enough to start building the habit of saving. How much is $10 per paycheck?
If you start saving $10 per paycheck (we’re assuming bi-weekly pays), then in a year you will have $260. If you start at 25, but the time you reach 67, you will have saved $10,920. That is a really good used car!
Now think about what that $10 actually is. For a bi-weekly pay, that is about $0.71 per day. Do you do anything for $0.71 a day? A trip to Dunkin? A small fry? A candy bar?
Now, let’s move up to $50 per pay
Looking at the average income for the area, $50 for a paycheck is nearly 12% of a pay. However, from 25 to 67, you will have saved over $50,000!
What is $50 a pay?
$50 a bi-weekly pay is $25 a week. That is about $3.57 per day.
This is one less meal out. Or, this could also be one less movie date.
Finally, let’s contribute to a retirement account while saving
The most advanced way of saving for retirement is by saving cash, while also investing in a retirement account like a 401(k) or an IRA.
How much should get to each?
Let’s start with the $50 per bi-weekly pay. Let’s contribute $20 per pay to your savings account. And, let’s contribute the other $30 to your 401(k) – we’re also going to assume a 5% return on your contributions in your 401(k).
If you start at 25, and retire at 67, how much do you have?
Well, your cash in your savings account will amount to about $21,000. Your 401(k), on the other hand, will be worth over $111,000! Together, you will have access to over $130,000 – and you did it by depositing $50 per paycheck.
You can start by contacting us today
Stop in, or give us a call, and get started with your savings account.