Simple Truths About Money

7. The longer you live, the more money you will need.

Thanks to breakthroughs in medical science we are all living longer...much longer. But most of us are still planning to retire at age 65 or earlier, which means funding 20, 30, or 40 years with no earnings from employment. Where will the money come from? If you are lucky, from a pension or social security, however more likely, it will come from your savings.

For this reason, retirement planning is critical even when you are young; the more you save and invest early, (because of the power of compounding interest), the more you will have later. It is never too early to get started with retirement savings, so fund the 401k, SEP IRA or Simple IRA, contribute to a Roth IRA account. If you do this every year you will likely live comfortably during your retirement years.

Your Complete Retirement Planning Road Map: A Comprehensive Action Plan for Securing IRAs, 401(k)s, and Other Retirement Plans for Yourself and Your Family by Ed Slott

more money truths