It’s easy to assume that it’s impossible to save for retirement when you’re in your 30s. After all, most of us are still dealing with debt from our 20s and making big life changes like getting married and starting a family. Often, retirement is the last thing on our minds.
However, a bit of planning now will greatly pay off in the long run. Experts say that if you want to be able to retire by 67, you should have three times your annual income saved by the time you’re 40.
If this sounds out of reach, here are some ways you can start preparing for your retirement in your 30s:
Learn about money
Unfortunately, most of us are not taught about money in school. That means it’s up to us to figure out how to increase our credit ratings, how to invest, how to trade CFDs, and how to prepare for retirement. While this can seem overwhelming, there’s now more information than ever available online and countless books that can break it down for you. Check out I will teach you to be rich and follow some of the top finance bloggers who will help you learn everything you need to know.
Open an investment account
One of the most effective ways for you to build wealth is through investing. And you don’t need to have a big chunk saved before you start investing. There are a number of great micro-investing apps like Acorn, which allow you to set up regular transfers, along with your ‘spare change.’ Every time you make a purchase, the app rounds it up to the nearest dollar and adds it to your fund.
Set savings goals
You’d be surprised at how many people are saving but don’t really know what it is they want. Think about how you’d like the next decade and your retirement to look. And then come up with savings goals that will allow you to get there. Do you want to buy a home? Take a big trip abroad? Go back to school?
Calcluate how much you’ll need to be saving, and begin setting aside that money each week.
Open a Roth IRA
If you have an employer-sponsored fund, hopefully, you’re putting as much as you can into that fund. However these days, more and more people are working for themselves. Consider setting up a Roth IRA. You can put up to $5,500 in this each year. While you’ll pay tax on your contributions now, the earnings are tax-free. That way, you’ll benefit from decades of compounding interest.