It’s a given that most people know you’re “suppose” to start saving for retirement early. The ambiguous part is how “early”?
If you have read my first post, it was obvious that I used to be in financial denial about my debt, choosing to believe it would all be paid off “one day” as long as I was making minimum payments towards it every month. I couldn’t face the reality of my current money (or lack of) situation, never mind plan for the future and save for retirement!
Even after I had my moment of realization a few months back and determined that I needed to be proactive in order to pay off my debt as soon as possible, saving for retirement was not a top priority. I was more concerned with the present and the rapidly accumulating interest on my credit cards. Not to mention that darn massive student loan!
To be honest, because my debt load is still so heavy, saving for retirement is still not a top priority of mine but after spending time with J and his well-off retired parents in Mexico, I had a “ah-ha light bulb moment”…..
I want to live the good life in retirement too! I want to travel the world and spend endless days in the sun experiencing different cultures and meeting new people. I want to see the world’s historic architecture and have dinner in the biggest cities. I want it all!
In order to have it all, I have to start saving for retirement NOW (despite the debt).
So I opened a Tax Free Savings Account (TFSA) with a $100 contribution to use as my “start-up” retirement savings account and every month $25 from my daily account will be automatically deducted and transferred into the TFSA. Compared to other people, (especially personal finance bloggers ) this amount is peanuts; but right now it is the amount that I can afford while I attack the debt load which is better than not saving at all. Another option I was considering was opening up a certificate of deposit and banking over the internet to earn high interest yields
In a few years, when that ball and chain debt is paid off, I will aggressively contribute to my TFSA and hopefully max it out but until then, I will continue living my newly adopted frugal lifestyle and daydream about living the good life in retirement.
Did you have an “ah-ha light bulb moment” when it came to realizing the importance of saving for retirement early?