Save Your Retirement: What to Do If You Haven't Saved Enough or If Your Investments Were Devastated by the Market Meltdown by Frank Armstrong IIIMy rating: 4 of 5 stars
I know what you're thinking, "what is a 30-year-old doing reading a book on retirement? Isn't that something people in their 60's or later start thinking about?" Sure, I may not be the target audience for this book, but I am very interested in the subject, and you should be too!
Retirement is something that needs to be planned ahead of time, way ahead of time, decades ahead of time. Most research will tell you that planning for a retirement fund should start as early as possible, by early we are talking about your 20's or early 30’s if you want to invest and have the opportunity to actually see your money grow. But, sadly, most young people (along with older adults) have less than $1200 in their savings, and are burdened with large amounts of debt from student loans and credit card debts. If you feel this is a subject that hits home, then please read on, because this book is just for you.
I picked up this book from my local public library after realizing that I was struggling in my personal finances. I am not perfect, I have made alot of financial mistakes, as I am sure many have who are reading this. I recall perfectly seeing the book in the shelf of my library, with its bright red corner and white glowy text, as if to say “Pick me!!” and so I did, and took it home and placed it aside and watched a movie instead...as I usually do. It stayed by my night table for 3 nights before I even opened the first page. Then, one night, after watching the disastrous Jurassic World sequel, I felt like refreshing my mind and disconnecting from the garbage I had just sat through, and so, I picked up the book by the night stand and began to read. I read half of it in just one night, and finished the rest in the morning.
After finishing the book I had this feeling of disappointment in myself, perhaps because I had not read up on anything related to investing, saving or finances….ever! It was at this moment that I realized that more people needed to be better informed about how to save and how to plan ahead to avoid problems when it comes the time to actually retire. Now, granted, this book isn’t designed for young people, but it does have alot of information that can be applied right away.
There’s several rules and advices laid out in the book, one of the most simple and yet complicated for some individuals is to pay off al kinds of debt: car, credit, loans. All of it must be paid off as quickly as possible before even starting a savings plan. If you already have a savings account, as difficult as it may be, used it to pay off all credit card debt in full. Then, get rid off the cards, only use debit or cash. Credit should only be used if you can afford it or if you are smart in using it, and lets face it, most people aren’t very good or smart at using them. Rule of thumb, pay off all credit card debt in full by the end of the month. If you can’t afford it, don’t buy it. Once you have paid off all the debt, then you need to start paying the most important person...that is yourself. Start with a savings account, it should have at least 3-6 months worth of salary for any type of worst case scenario emergency. Maybe your car broke down, your roof got damaged after a hurricane and the insurance won’t cover all the damages, maybe you need to make an emergency trip to visit a sick family member, or you got laid off from work...all of these are drastic, but realistic scenarios you need to think about. This book states and explains how to start small and work your way up.
Savings account don’t have much interest accumulated, which means that they don’t move accordingly with the economic inflation. So, the book explains you have to create a low risk retirement fund. There’s several, the most common is a 401k, which some employers match and is widely used. The one I was most interested by was the IRA (individual retirement account) a low risk account, which you place money aside, which you can’t touch until you are 55 years old. Now, there’s a catch, you can either pay the taxes now for that money you are saving, or you can pay the taxes as you are retrieving. Personally, I think it’s best to pay the taxes first and not later. Also, you might be asking “How much should I retrieve?” Good question! The book estimates, that you need to save enough to be able to take out 4% of your retirement saving every year you are retired. Let's assume you retire at 65, and you live very modestly, and let’s assume you are going to live until your late 80’s...guess what? You are going to need alot of money. That’s why it’s adviced to start early, and plan ahead. I can keep going on and on but it is best if you actually read the book and start taking notes on how to invest, and how to create a safety egg nest now so you don’t have to worry at a later age. This was a very informative and educational book that I think everyone should read and be taught in schools. Highly recommended.
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