Ploymint

If you’re a young millennial there’s a good possibility that you haven’t thought about saving for retirement yet. There are a variety of reasons of why some of us may not be saving for our later years. It could be staggering student loan debt, a late start on your career, or bad budgeting. Much of it also has to do with our career choices, and that retirement benefit packages are few and far between, especially for the 38% of us working freelance jobs.

You may not get the opportunity to participate in a traditional pension plan, but there are things that you can do to prepare for your future. Even if you’re the type of person who is nowhere near where you want to be in your career, moderate saving now could make your life easier as you get older. Don’t be afraid if you don’t have a lot saved either, these are tips, not a reprimand. According to a recent study by Go Banking Rates, a staggering 62% of Americans have less than $1,000 saved.

Here are some tips and guidelines if you’re a millennial who wants to save for retirement.

Start Save Starting Now

Most of us won’t see a 401k, so we will have nothing to fall back on if the going gets tough in our later years. Even if you don’t make that much, start saving now. Saving $100 dollars a month over 30 years will net you $36,000 in savings with no interest at all. If you are able to take that money and invest it with a moderate return, it could transform into a very large sum of money over time. For instance, if you were able to make a very good return of 15% annual compounding interest a year, that investment would net you $528,315.35 by the end of the 30 years.

It doesn’t matter if you feel like the amount that you’re saving is insignificant. Make it a habit of investing money from your paycheck into your bank account each month. Do what you can to prevent yourself from prematurely withdrawing funds and try to set up a routine that you stick to. This is not a rainy day fund that you should empty out for a vacation, this should be an account that only builds in value over time.

Budget Your Lifestyle

If you are younger, this may be a harder thing to do. Millennials like to enjoy life, indulge in more expensive products, and travel. All of these things cost a lot of money that you could be saving for retirement. Realistically, we don’t want to forgo having fun in order to save, so think about more practical ways that you can save money. Things like turning off computers or appliances when we aren’t home will reduce the electric bill. Don’t incur overage charges and pay your bills on time, and make sure that any recurring charges to your bank account, like magazine subscriptions, are actually being used.

Think about other ways you can reduce your bills like switching to a different mobile provider, reducing your cable package, or buying groceries in bulk. A $50 dollar reduction on your monthly bills will save you $3,000 over 5 years. Calculate how much you are spending each month on things like food, clothing, and your social life, and then calculate how much you are actually making at your job. Make cuts and alterations when appropriate and be realistic about how you want to live and how that matches with how much you are making.

Make Good Investments

You should really be making your money work for you. Inflation, and devaluation of the dollar means that the actual net worth of your money is going to fluctuate over time. While saving is the key to actually building a nest egg, managing your money and investing it properly will bring real wealth. If you’re not good at buying and selling stocks and bonds then you should link up with a financial advisor.

If you do manage to work for a company that offers a retirement pension or 401k plan, take full advantage of it. Since most employers are willing to match a portion of funds that you are putting in, this is a safer way to invest that doesn’t rely on the strength of the market.

One last thing to keep in mind is that the future is unsure. You may get hurt or laid off from a job which will seriously cut into your retirement savings plan. Our lives sometimes take unexpected turns, so having a savings, even if it’s for retirement, gives us some extra security and eases our mind about our financial future.