We all know we should be saving for retirement… but it’s not easy to do. Life gets in the way and retirement seems so far off. I’ve managed to make retirement my biggest financial priority through a combination of positive (financial freedom!) and negative (fear of spending old age in penury) motivation.
Here are the 5 things that I tell myself to save for retirement:
1. I want to enjoy retirement free from financial worries.
I want a retirement filled with volunteer work, extensive travel, a comfortable, paid-off home, and plenty of friends and socializing (I’ll be that old lady at dim sum on a Wednesday morning). I would not enjoy my retirement if I spend my days worrying about deciding between groceries or the house payment. I would not enjoy my retirement if my sole source of income depended on Social Security.
2. I want to afford a reasonable level of medical care.
With family members who work in the medical field – and who see, every day, the consequences of being old, sick, and poor in America, I am well aware that health care costs will probably exceed anything I can imagine at this point in my life. I don’t know what the state of health care will be like in 40 years, but I do know that even with health insurance, (1) illnesses will be expensive, and (2) having more financial resources will make me more comfortable in a time of sickness.
3. If I have children, I do not want to burden them with my care.
I want my children to fret about getting me the perfect birthday present, not to worry that if they don’t send me money each month my gas will be shut off. Freedom from worry about my financial situation is one of the best gifts I can give to the next generation – it’s a gift that my parents have given me, and I would want to continue that.
4. I do not want my parents to worry about my financial well-being.
I’ve been fortunate to receive a lot of educational assistance from my parents. There’s even the possibility that they will leave a little bit of real estate to me in the future. But I never want my parents to worry about my ability to provide and save for myself after they are gone. They should enjoy their hard-earned money. If they leave me something, great. But I don’t want my parents to scrimp and save because they are afraid that my finances depend on getting an inheritance.
5. I want to leave an inheritance in event of unexpected demise.
If I die before I retire, I want to leave something to my loved ones. One of the refrains I’ve heard is that “you can’t take it with you when you go,” which is true – you can’t take anything with you when you go. But I don’t see leaving money behind as a waste. In fact, I would consider it a privilege to leave a bequest – however small – to the people whom I love and who love me.
Why do you save for retirement? Are your reasons similar to mine?
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you are the prudent one aren't you?? These is the kind of thinking that a person with the future in mind has to have, Unfortunately when we are young we think that we will live forever and so dont give retirement much thought
Hello Wellheeled and kenyantykoon!
I don't know what it is, but retirement is forefront on my mind, ever since I was like 16 years old. And it's not that I think about it like "I want to get out of the rat race as quickly as possible", but more like I need to prepare for the reasons you are discussing above. As a young person (27), I realize that any money I sock away now is worth much more than money I sock away later, and that is exciting to me as well. Also, my grandparents saved absolutely no money towards retirement, and now they sit around…a lot. They are on a fixed income, and though they do a great job with what they have, they occasionally have to ask their children to pay for things (such as property taxes at the end of the year).
Thanks for the post!
Good for you for starting early! I wasn't thinking of retirement at 16… but I always knew that I do not want to be just sitting around when I have a lot of time (i.e. when I've retired from full-time work). I want to travel! (which takes money…). Later on I learned about the expense of health care and then realized I need a LOT of money.
I like your reasons and a lot of them seem very selfless since you're trying to be less of a burden on others… I have similar reasons as well
I don't save for retirement. How much would you save if you had a poverty-level income?
"I want a retirement filled with volunteer work, extensive travel, a comfortable, paid-off home, and plenty of friends and socializing."
Concise and well said! I made a list of 100 life goals that I'm in the process of revising and prioritizing. THAT is definitely going on there as motivation for me to keep saving and something to look forward to!
I take a particularly unconventional route when it comes to 'saving for retirement.'
I call it investing for cash flow. It's a lot more of a simpler equation and takes a lot of complicated matters and makes them simple. Ideally. I want to spend the currency and/or time I get on income producing assets. So that I got a stable, trackable cash flow every money. And what I make per month (or on an annual per month average) would be the bench mark of my retirement. Once I have a cash flow that exceeds my expenses, I'm financially independent. Should it double, than I can consider retirement. <3