Banking Law

Twelve Personal Finance Mistakes - Retirement

By Eugene S. Melchionne, Connecticut Consumer Attorne

Yeah, it’s a long way away and every year, it seems to get further away as the federal government raises the age to collect social security.  But Social Security was never meant to be a substitute for a retirement plan or pension and advances in health care lead to living longer.  As they say now, 60 is the new 40.  Or something like that.

The sooner you start putting aside money for retirement, the more you will have at the finish line.  Also if you start to put money aside earlier in life, you do not have to contribute as much as you would if you start much later in life.  Over time, the difference between $25 a week starting at age 25 versus $100 a week at age 50 can be more than a  million dollars in favor of the 25 year old.

Don’t keep your investments for the future in one place.  The current economy is a good example.  Those people who invested solely in mortgages have taken great loses in the market.  So too are those who have invested solely in corporate stocks.  Practically every investment vehicle is down, but… and it is a big but, not all of the investment vehicles are down at the same time.  So if you spread it all around, a little in one area and a little in another, the combination of funds will keep it all growing together.

Full post as published by Debt Law Network on June 07, 2009 (boomark / email).