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Kristen Renee

Save your way to early retirement

Roughly one third of American adults don’t have any emergency savings, meaning that over 72 million people have no cushion to fall back on if they lose a job or have to deal with a crisis. Fourty two percent of millennials have not begun saving for retirement at all.

In an economy where 17% of americans can not secure long term employment and 8 out of 10 americans are in debt. Increases in medical costs and food expenses outpacing wage growth are common reasons americans say they simply can’t afford to save. With fifty five percent of americans breaking even or spending more than they make, how can you stop this “working to get by” lifestyle?

Figure out what areas you are over spending in and cut out everything that isn’t a NEED.

  • If you’re spending more than 30% on housing you are probably living above your means and cheating yourself out of retirement savings.
  • According to the United States Bureau of Labor Statistics, the average american spends nearly 6% of their annual income on entertainment. There are many ways to save on entertaiment. No matter how much money I make I will never have cable. If you can find little ways like this to save it will add up. (Go see that new movie in 2D instead of 3D, Eat before you go to the theatre to cut back on overpriced concession urges.)
  • Are you paying monthy for things you rarely use? Do you have a Netflix membership even though you rarely use it? Joined a local gym and got really into it for a month and have yet to return? Cancel these things and save yourself atleast $360 a year toward your retirement.
  • Avoid late fees by prepaying your bills. In some cases you can get a better rate for paying more up front. Some insurance companies save you more money if you pay 6–12months at a time. Buy your car if you can rather than financing and making monthly payments, this will save you on interest rates.
  • Fewer bills=higher savings percentage. Americans who are saving for retirement are seting aside 10% of their annual income. Using techniques above I have saved between 60–70% of my annual income. If you can, budget yourself to save atleast 35% toward retirement.

I wont get into 401k, IRA, savings with interest or investments on this particular article. I hope these SIMPLE steps taken every day will help put you on the path to retirement.