For the generation commonly known as the baby boomers, retirement is approaching faster than most want to admit. Some have made plans and begun preparations, while others have made only token efforts at getting ready for the next stage of their life.
For their children, it is time for you to start too. It sounds like a cliché, but you cannot start too early, in planning and saving for your retirement. For younger people, this means starting a retirement fund (IRA, 401(K) and so on) now.
Even if you only put a small amount in each month, it will add up over time and, more importantly, you will establish the habit of regular investing for your retirement. Most of your retirement fund at an early age should be in stocks.
Later in life, you can begin to adopt a more conservative approach, but in the beginning put your money into stocks.
One of the reasons parents give for not saving for retirement is college for the kids, but college can be funded, at least in part, with loans that young adults with jobs can pay off. You can't fund your retirement with loans.
Few people at a young age can imagine with certainty how they would like to spend their years after retirement. However, the older you get, the more thought you should give to this question because it has financial implications for your retirement.
A retirement spent traveling the world will require a larger size nest egg than a contemplative retirement of gardening and intellectual pursuits. If you have a goal in mind, it is easier to motivate yourself to become active in structuring your retirement.
However, it is more difficult to attain expensive goals such as world travel if you make the decision just a few years before you retire and begin saving and investing then.
Family demands often conflict with retirement goals for financial resources. One of the facts of life is that most people have more than one pressing financial goal at a time.
They know saving for retirement is important, but so is college for the kids, and so is getting aging parents situated in comfortable surroundings, and so on.
Understanding that most people have more than one goal competing for resources, financial professionals caution that even if you have to cut back on saving for retirement, you should not stop altogether unless you are facing a financial crisis.
If that means some of your children's college education is funded by student loans that they will have to repay, so you can keep some healthy portion of your retirement plan funded, then that's what you should do. Young people have their entire adult life to pay off a student loan and establish themselves financially.
Your earning days are winding down and your retirement is fast approaching - this is a time to think about your future.