A Lesson For Young People: Look at Your Parents and Try Not to Be Like Them
How can it be? A 65 year old who retires today may only have enough money saved up to last maybe 5 to 7 years depending on how much they get in addition from social security and pensions.
Figures compiled by the Vanguard Mutual Funds reveal the average retirement account they hold—for people 65 and over has less than $200,000 dollars in it. Not enough to carry a 65 year old for maybe 25 or 30 years.
And younger workers have a harder road ahead. Most no longer have company pensions and they may not have social security when they turn 65. Their situation looks desperate. But wait — there is time to prepare. However, many are letting opportunity pass them by.
Many companies offer 401-K retirement plans, but many young workers are not participating. A study from Pew Charitable Trust found nearly half of those who are offered a 401-K don’t take it. Some think they can’t afford it. Others say they don’t want to spend money now that they won’t see for decades—hold that thought!
Fidelity investments which handles nearly one out of three retirement accounts in the USA says the typical employer match is 4.7%. That means the company throws in FREE money — 4.7% of your income! That’s a nice bonus every year! All you have to do to get it is contribute some of your own money, directly from your paycheck. Because the money grows tax deferred it can add up faster. It’s like jump starting your savings!
At the end of the third quarter of last year Fidelity had 187,400 accounts which had grown to a million dollars or more!
And many of these wealthy people were still working, and saving, and watching their money grow even more. Of course that money is invested in the stock market and the market has it’s ups and downs but over time it can be a mega money maker-better than a lottery ticket. But like they say with the lottery, “you have to play to win.”