suppose you could teleport to your 70th birthday what would you hope to find yourself doing going
on a cruise ship writing your Memoir partying in Ibiza or basking in the sun on an exotic
tropical island very few of you would answer flipping fries at McDonald's scrubbing toilets
at Burger King or begging for money on the street no one wants to spend their retirement years that
way but surprisingly for about 10 million Americans in retirement that's their life
instead of spending their retirement playing with their grandkids fishing or traveling the world
they're serving you hamburgers in McDonald's coffee at Starbucks clearing your shopping in
Walmart driving you around town or sadly in the streets old and homeless and completely isolated
from the world lucky if they can find somewhere safe to sleep and with no means to live a normal
and happy life that's their sad life basically a situation that they might never Escape so why am
I telling you this do you have your retirement well thought out or will this be your fate
if I had it planned harder when I was younger and the things that have went better I wouldn't be
going to work this morning I'd be going fishing what did you think you'd be doing at 66. oh I
would hopefully to be retired and what are you doing at 66 I'm working my butt off I'm homeless
because when I got him out of the hospital I lost everything so I had no place to live I didn't have
no place to stay I do recall sleeping one night behind a dumpster for Tom Marianne Linda and
25.6 percent of retirees this is their reality according to the Bureau of Labor Statistics if
they want to survive put food on the table and a roof over their heads they have no choice but
to get a job and while this number is high by 2031 it's projected to get even worse as nearly
a third of people who should be in retirement will be forced to find a job people are living
longer in fact you'll probably live well over 80 years and most likely nearly 90 years old by
2060. according to the U.S Census Bureau and while this is good news for all of you watching meaning
you can now spend more time with your grandkids go fishing playing golf traveling the world basically
anything you dreamed of doing in retirement here's the bad news as you live longer you're gonna need
quite a lot of money to sustain your lifestyle how much you may ask well according to Charles Schwab
latest study the average American worker believes they'll need about 1.7 million dollars to enjoy
a comfortable retirement and Jen zeers estimate that they'll need to save 1.4 million dollars and
Millennials think they'll need about 1.8 million dollars for a good retirement now here's the
problem saving is not something a lot of Americans are good at actually we're kind of bad at it and
a bank rate survey found that just over half of Americans said they don't have as much money saved
for retirement as they should and in this group 35 said they're far behind on their savings goals
while 20 said they're slightly behind and if you take a deeper look a go banking rate survey found
that just 14 of people have saved a hundred thousand dollars or more for retirement while
a huge 78 percent have saved fifty thousand dollars or less even among those aged 65 and
older who had the most savings only 36 percent had saved a hundred thousand dollars or more and get
this almost a quarter hadn't saved anything at all for retirement basically if most Americans were to
retire today they would probably end up homeless which is a symptom of their poor saving habit and
these numbers clearly highlight a large gap between the amount experts recommend we should
have for retirement and the actual Savings of the average person especially as they get closer and
closer to retirement but with the High Cost of Living and storing inflation making everything
from milk bread gas rent water electricity Etc so expensive people are struggling to put food on the
table let alone set money aside for retirement a recent survey by any time estimate revealed that
only 63 percent of people who have not yet retired are still saving for retirement which is a huge
drop compared to 93 before the pandemic and aside from that most people delay saving for retirement
because they assume they have plenty of time to catch up later and yet the earlier you start
saving even with small amounts the more compound interest can work in your favor and saving small
amounts of money early can pay off much more than large sums saved later so how does saving
small amounts early and investing it put you in a stable financial position and what is compounding
interest basically it's simple mathematics and let me briefly explain to you how compounding Works
using two scenarios and then I'll show you how you can also also do your own compounding calculations
so first you have a friend John over here he started saving a hundred dollars every month
when he was 20 years old after 40 years with a four percent average yearly return compounded
monthly John ended up with 151 550 at 65. yet his total investment was only fifty four thousand one
hundred dollars quite impressive wouldn't you say then there's Nick Jon's twin Nicki started saving
when she turned 50. she began with a lump sum of five thousand dollars and then lowered it to 500
monthly for 15 years like John Nikki also got a four percent average yearly return compounded
monthly however by the time Nikki turns 65 her total savings were only 132 147 even though her
total investment was ninety five thousand dollars despite investing roughly twice the initial amount
John did Nikki's savings still didn't grow as much as his this simple example shows it starting early
and giving your money more time to grow can make a big difference in the long run so keep in mind
that it's not only about how much you put in at the start it's also about how much time you give
your savings to grow now if you go to investor.gov using the link in my description it'll take you to
this website which you can use to do your own compound interest or investment calculations
here's the thing retirement planning is a deeply personal journey and it's one that requires
patience and time while keeping in mind that the initial number you put down on paper whether
that's 1.7 million dollars according to the survey I previously mentioned or something a bit more
modest the reality is 30 40 or 50 years from now life as you know it today will look completely
different and a lot is gonna change so you have to keep that in mind rent food utilities health care
and so on will likely get a lot more expensive if you're starting to save for retirement Fidelity
Financial firms suggest saving at least 15 percent of the income you receive before taxes are removed
and put that into a retirement fund and this includes any contributions matched by your
employer but this advice only works if you start saving at age 25 and work until you're 67. sadly
not everyone can start saving for retirement at 25 or manage to regularly save 15 of their income if
you start saving later in life or save a smaller part of your salary it might mean that you'll
need to work longer cut your spending or put a larger part of your income into your retirement
fund for example if you start saving at age 30 Fidelity recommends saving at least 18 percent
of your income before taxes and if you start at 35 they suggest you save up to 23 percent of your
income before taxes in the description box you'll find a lot more information that didn't make this
video and if you found this video informative check out this video how to have a debt free