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Starting Early Makes It Easy And Affordable
Retirement may seem like a distant goal that’s a lifetime away. The reality is, starting early can make a huge difference in achieving your retirement goals. Every year you put off saving for retirement, you miss out on the power of compounded earnings.
“Compounded earnings” refers to the money you make on your contributions and
the interest you earn. The earlier you start, the more compounded earnings will cause your savings to grow. Let’s see how starting early made it easy for Mary to realize her retirement goals.
Mary and Dave—Dave falls behind
Mary and Dave each set aside $500 per month for 10 years. However, Mary started at age 25, while Dave waited until he was 35. Each retired at age 65. Even though they both contributed the same amount of money, Mary’s retirement savings balance is more than double Dave’s balance at retirement! That’s compounded earnings working for you.
These tables are intended as educational tools only. Calculations are estimates and may not provide accurate projections. Your actual circumstances, including current income or retirement needs, may vary.
Can Dave catch up?
Now assume that Mary makes no changes to her savings plan, but Dave tries to catch up by saving $500 per month for 30 years instead of just 10. Although Dave will end up contributing three times as much as Mary, she still has 30% more retirement savings at age 65!
The time to save is now!
These tables are intended as educational tools only. Calculations are estimates and may not provide accurate projections. Your actual circumstances, including current income or retirement needs, may vary.
To have $500,000 when you retire at age 65, you will need to save:
• $32.77 each week if you start at age 25
• $76.90 each week if you start at age 35
• $194.89 each week if you start at age 45
• $628.37 each week if you start at age 55
