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For quite some time now, a million dollars has held strong as the standard amount of money one should try to have for retirement. While it’s true that a million doesn’t go as far as it would have years ago, it’s still a decent baseline for planning for retirement.
If you can commit and take the proper steps to saving $1 million before you retire, there’s a good chance you will have more than that because you’ve mastered the skills that it takes to manage your money well while also planning for your future.
Here are some steps on how to save a million dollars before you retire:
- The earlier you start, the easier it is. Did you know that a 20-year-old can save just $10 a day for the rest of their working life and have $1 million at retirement? That said, the younger you start, the more you will have to save, but it’s never too late. You just need to work out the math based on your edge.
- Commit to saving it. Before you bother with doing the math and working out how much you need to save each week/month to earn a million for retirement, you really have to get into the right mindset. If not, you can plan all you want, but you’ll never actually follow through with it. Think about why you want this. Think about the things you want to be able to do in your retirement. Think about how important it is for you to retire at a certain age and how much that money would help you. All of these things will get you in the right mindset to truly commit to the saving, rather than just jump on the idea because it sounds good, with no follow-through.
- Now do the math. Now that you are ready to go, you need to do the math based on your age, to help you determine how much you need to save to reach $1 million by retirement age. There are also calculators available online that can help you with this. If you start saving $405 per month at age 25, or $585 per month at 30, for example, you can reach that goal.
- Live below your means. Just because you can afford something, doesn’t mean you need it. Living below your means doesn’t mean you have to go without things you need, or that you can never treat yourself to things you want. However, it does mean that you can likely choose to have a little less, use a little less, or do a little less, making it easier to save money for the future.
- Automate your savings. Finally, you should make your savings automatic. Then, you never have to think about it and you can never forget it. If possible, you should have the savings come automatically out of your paycheck so you never miss the money because you never see it.
Now that you know how to do it, all that’s left is to get started and make it happen. No matter where you currently are in life – in age, or in financial standing – you can start today. If you commit to it, and stick to your plan, you can make it happen.
The most important part is that you stick to it. It’s far too easy to fall off track during a rough patch, or get so caught up in life that you let it slip by and don’t save. If you’re not actively saving every month, you’re not going to see the results listed above. It takes effort, and sometimes it will take resolve, but it will pay off when you’re able to retire with at least one million dollars.
Frugal Living Resources:
The Minimalist Budget: A Practical Guide On How To Save Money, Spend Less And Live More With A Minimalist LifestyleLive. Save. Spend. Repeat.: The Life You Want with the Money You Have925 Ideas to Help You Save Money, Get Out of Debt and Retire A Millionaire: So You Can Leave Your Mark on the WorldMinimalist Budget: Simple Strategies On How To Save More, Spend Less, And Curb Spending Temptation (Without Living On Ramen)How to Save Money: 177 Tips to Save Money (Up To 4150 $ / year !)
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