Warning: Don’t Let Your 20’s Go To Waste

By on May 28, 2014

investingI just turned 27 a few days ago, and I officially feel old.

I guess I should; I am a parent now after all. Yet, there was just something about 27 that was just a tad too close to 30, you know that time when you should have your career somewhat thought out and your retirement accounts nice and in tip top shape.

In all of my writing about personal finance, I have really struggled with my own retirement plan.

I have never had a job where I was offered a company match. I was employed as a graduate student, a contracted park ranger, an college instructor at an international school, and now I’m self employed.

I don’t know what it’s like to have good benefits, stock options, or anything like that.

Still, I’ve made it a point to max out an IRA the past two years, but I definitely wish it could be more. There are people my age who have been depositing the full amount into their 401ks for 5 years. They could easily have 6 figures already saved for retirement whereas I am just getting started.

Don’t Let it Go To Waste

The point of telling you my personal story is to encourage you not to let any time go to waste when it comes to investing. The earlier you start, the more money you will have in the end. It’s as simple as that. Plus, if you understand the basics of interest over time, you’ll notice that if you start saving for retirement at 25 verses 35, it could mean the difference of tens of thousands of dollars, sometimes even more.

Get Used to Living on Less

If you have a new job, go ahead and allocate the highest percentage you can to your retirement account. You’ll never miss it if you don’t have it from the start. Additionally, if you get a raise, you can deposit the difference into your retirement account as well. If you do this enough times, you’ll be surprised at how early you can retire. All you need to do is watch the numbers go up all while you live within your budget.

Along with allocating a certain amount to retirement, it’s just a good habit to start monitoring your finances more closely. It’s important to start telling yourself “no” when it come to bigger purchases that you can’t afford and “yes” to more low key activities.

Ultimately, I know your 20’s is a time to have fun, to enjoy college, and to really soak up your youth while you have it. I can tell you from experience that it really is amazing how quickly it goes by. Before you know it, you’ll be 27 with two kids, worrying about saving for college and retirement all at the same time.

It sounds stressful, but it really isn’t. As long as you don’t let your 20’s go to waste and you start making smart decisions early, it won’t be long before you’re reaping all the financial benefits of your good decisions.

Photo Credit: Flickr Creative Commons

About Catherine Alford

Catherine Alford is a personal finance writer who received a B.A. from The College of William and Mary and an M.A. from Virginia Tech. When she is not writing for other websites on all topics frugal and fabulous, she enjoys sharing her adventures on her blog, www.BudgetBlonde.com. Follow her on Twitter @BudgetBlonde or like Budget Blonde on Facebook.

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