{"id":5169,"date":"2018-03-22T13:40:00","date_gmt":"2018-03-22T20:40:00","guid":{"rendered":"https:\/\/www.soundcu.com\/?p=5169"},"modified":"2023-10-30T21:31:13","modified_gmt":"2023-10-31T04:31:13","slug":"it-pays-to-start-saving-now","status":"publish","type":"post","link":"https:\/\/www.soundcu.com\/blog\/it-pays-to-start-saving-now\/","title":{"rendered":"It Pays To Start Saving Now"},"content":{"rendered":"
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In case you haven\u2019t heard, compound interest is the best.<\/p>\n

You may remember it as an equation you had to memorize for math class, but it\u2019s so much more than that. It\u2019s the concept that powers all sorts of savings and investment products and, over time, allows you to turn your money into, well, more money!<\/p>\n

Even though compound interest is easy to understand\u2014compound interest = more money for you!\u2014those who can potentially benefit most from it (those in their teens and 20s) don\u2019t seem to be taking advantage of it. Savings contributions and retirement savings participation rates are falling among young adults.<\/p>\n

So if we understand that compound interest translates into free money down the road, what could possibly be standing in the way?<\/p>\n

As it turns out, it\u2019s not so much a math or finance issue as it is a life issue\u2014if we have trouble identifying our life goals, we\u2019ll also have trouble planning and saving for them. At the risk of sounding like Dr. Phil, we need to understand ourselves before we can fully understand our finances.<\/p>\n

Acknowledge the big picture<\/h2>\n

This is a tough one, because a lot happens between your teens and your 30s. You\u2019ll experience a combination of moving out, starting your career, dealing with student loans, getting married, financing a home<\/a>\u2014all these things have their own set of stresses that make it difficult to see past them. When you\u2019re a new grad and job hunting, it\u2019s hard to imagine yourself retiring in 40 years. If you\u2019re living with your family rent-free, it\u2019s hard to imagine yourself putting down a deposit on a home. If you\u2019re living paycheck to paycheck, it\u2019s hard to imagine having enough to pay off your student loans<\/a>.<\/p>\n

The first step is to acknowledge that you want these things, even if they seem impossible right now. You want to retire comfortably. You want to buy a home. You want to live debt-free. You may even want to travel or go back to school. These goals may seem far away, but they\u2019re definitely there and they\u2019re certainly not going away. Every day that goes by is one day closer to the time when you want to achieve those goals.<\/p>\n

The good news is that a little bit of your time and energy now can go a long way later. Make an appointment with your credit union to learn about their savings products<\/a>. Take 10 minutes and set up a direct deposit into your savings account. When you\u2019re dealing with compound interest, the longer you wait to get started, the less money you\u2019ll earn in the long run.<\/p>\n

Lack of clarity is self-sabotage<\/h2>\n

If you\u2019re already at the stage where you can see the big picture, it\u2019s time to get specific. You know you want to save for your retirement\u2014great! But how much is that, exactly? $350,000? A million dollars? More? Do you have any idea?<\/p>\n

These questions aren\u2019t meant to overwhelm you, but if they caught you off guard, that means it\u2019s time to add some real dollar amounts and real timelines to your big-picture goals. For example, you could turn \u201csaving to buy my dream home\u201d into \u201csaving $50,000 in the next 12 years for a down payment on a home\u201d.<\/p>\n

Details make your saving goals more tangible, more immediate and, therefore, easier to commit to. Take a little time, do a little research and turn your big picture into something you can start on right now.<\/p>\n

Don\u2019t let decisions overwhelm you<\/h2>\n

Not many people enjoy making decisions\u2014especially when it comes to life changes and major financial commitments. It\u2019s easy to understand why\u2014decision-making is scary (not so much the actual \u201cdeciding\u201d part, but more the \u201cfear-of-making-the-wrong-decision-and-regretting-everything-forever\u201d part).<\/p>\n

Savings goals require you to make a lot of big decisions. You need to choose goals to focus on, you need to choose between different banking products and you need to choose how to distribute your savings contributions. Sometimes the choices are brutally blunt, such as choosing between owning a car and paying off your credit card debt.<\/p>\n

The important thing is to not let all that decision-making overwhelm you. Remember: just by facing those decisions, you\u2019re making progress, because you\u2019re establishing what\u2019s most important to you and you\u2019re renewing your commitment to your goals.<\/p>\n<\/div>\t\t\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\n\t<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

It\u2019s the concept that powers all sorts of savings and investment products and, over time, allows you to turn your money into, well, more money! Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":10,"featured_media":5170,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","_searchwp_excluded":"","footnotes":""},"categories":[50],"tags":[233,234,235,105,83,59],"class_list":["post-5169","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-life-finances","tag-buying-a-home","tag-down-payment","tag-dream-home","tag-goals","tag-retirement","tag-savings"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.soundcu.com\/wp-json\/wp\/v2\/posts\/5169","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.soundcu.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.soundcu.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.soundcu.com\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/www.soundcu.com\/wp-json\/wp\/v2\/comments?post=5169"}],"version-history":[{"count":0,"href":"https:\/\/www.soundcu.com\/wp-json\/wp\/v2\/posts\/5169\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.soundcu.com\/wp-json\/wp\/v2\/media\/5170"}],"wp:attachment":[{"href":"https:\/\/www.soundcu.com\/wp-json\/wp\/v2\/media?parent=5169"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.soundcu.com\/wp-json\/wp\/v2\/categories?post=5169"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.soundcu.com\/wp-json\/wp\/v2\/tags?post=5169"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}