How Soon Is Too Soon to Start Planning for Retirement

In a word - never. There's your answer. If you're convinced, you can skip ahead to another of this site's excellent articles. If, however, you need a bit more convincing that it's truly never too soon to start planning for retirement, then read on.

Some companies offer retirement benefits that their employees may or may not choose to take advantage of. Let it be said here and now, in no uncertain terms, if your company offers some sort of retirement plan, by all means, take advantage of it. It should not be your only source of retirement savings, but it's an excellent resource that shouldn't be overlooked.

Employees of companies with 401K plans (especially if the company matches funds deposited) should definitely avail themselves of this convenient and automated way to save funds for their old age.

But many companies do not offer such benefits. And then there are those workers who don't work for a company at all, but for themselves. Self-employed people must be especially attentive to their retirement planning.

Workers looking for a new job should take retirement provisions into account when deciding on companies to apply for and, ultimately, which successful job offer to accept.

An average American retiring this year needs upwards of $2 million in the bank to live out the remainder of their golden years in comfort. Two million dollars! Remember, not only is the cost of living rising, but so are our life spans. Today's workers can realistically expect to live well into their 80s or 90s or beyond. If you had only counted on your retirement money to last you until you turned 76, then you may find yourself in quite a predicament when you're least able to do anything to resolve it.

Sadly, ignoring the compounded affect of rising costs and life expectancies has led many an elderly person into a part-time, minimum wage position.

We all know time flies when your attention is elsewhere. Keep putting off saving for retirement and you'll find your potential savings trickling away into one unexpected expense after another. And in an era of increasing layoffs and companies folding to competition everyday, even workers with great pensions can't count on their jobs remaining secure all the way up until retirement.

Whereas a few decades ago a person could stay with one employer for their entire lives, now most workers have four-five different jobs over the course of their lifetime.

There is another reason to start saving for retirement as early as you can - and it's the most appealing reason of all: because the earlier you start, the easier it is to accumulate much larger sums than you otherwise would had you started later in life.

In fact, you'll have a bigger savings (all other things being equal) if you consistently put small amounts of money away from the moment you enter the work force than you would if you started socking away large sums at a time starting at 40 or 50 years old. Capitalizing early on the power of compound interest can help you build a sizable nest egg with minimal financial sacrifice in the moment.

Retirement should be a time of relaxation, fun, connection with family and friends, doing all the things you always wanted to do but never had the time, taking on new hobbies, traveling, appreciating life. It should not be a time spent worrying about your financial condition.

Protect yourself from potential future panic and forced sacrifice by starting and sticking with a retirement savings plan ASAP.

To find appropriate retirement plans for your current situation, review this website further and other sites focused on personal finances and retirement planning. Speak with your accountant. Schedule a session with a reputable local financial planner. Talk with your spouse and your children too. Encourage them to play a role in your future well-being. It will save you all unnecessary headaches and heartache later on.

Kenneth C. Kelly is the President of Strativia, a financial management software development and services company specializing in applications for personal and business use.  Strativia is the developer of Budget Forecaster, a sophisticated home budget and personal finance management software package.  Website: www.strativia.com.  Contact: info@strativia.com.

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