ENTER THE AARP SAVINGS CHALLENGE FOR WEEKLY CHANCES TO WIN -- CLICK AND SEND YOUR SHORT VIDEOS (45 seconds of less) AND ESSAYS (250 words or less) to enter. Full contest rules can be found here.
Are you worried about the shape of your savings? Around half of American households have no retirement accounts at all.
No 401(k)s, no IRAs, nothing. You might think that’s because we’re all expecting pension income in retirement. In fact, according to the Government Accountability Office (GAO), around 29% of households age 55 and older have neither retirement savings nor a pension. At when it comes to liquid savings to pay for life's little emergencies, a 2018 survey by the Federal Reserve found four-in-ten cannot afford a $400 car repair without borrowing money.
Experts agree that investing between 10 and 15 percent of your salary each year in low fee investments will get you on a path to a comfortable retirement. They also agree that people need to have a least a few months of income saved to be accessed for an emergency like a health care bill or a loss of employment.
Who Else Benefits?
Saving more also means less public assistance for the poor and more money available for other essential public programs like schools, roads, health care, parks and more. A 2016 UNCW study found on this site finds that increasing the savings rate to 3% for North Carolina’s pre-retirement lower to middle income population could result in $448 million accumulated savings to state expenditures between 2018 and 2030.
Does that sound daunting? Saving more for your income for retirement may be easier than you think.
Make 2019 your year for saving more. The AARP Savings Challengeprovides simple, practical ways to save every day. These are tips from real people that can add up to real savings.
And for you savers out there, the Challenge presents a chance to win!
Enter the AARP Savings Challenge Video and Essay Contest
Tell is in 45 seconds or less, or 250 words or less, what are you doing each day, week or mo
Want to learn how policymakers can help us save more for the future? Sign up for AARP Action Alerts on proposals that can help you have a more secure retirement.
Other helpful savings resources from AARP.
AARP Foundation Finances 50+ covers the basics of finances, including goal setting, asset building, budget planning and debt repair.
AARP.org/money - Let experts help make your money work harder for you.
AARP Fraud Watch Network - Keep the money you have by protecting yourself from scammers and fraudsters with our helpful tips.
Perhaps some of the easiest and often forgotten methods for saving that I have used includes the following strategies:
1) Reduce the number of coffees, sodas or other drinks purchased.
2) Reduce the number of candy bars, cookies or other possibly unhealthy, as well as unnecessary snacks purchased.
3) For smokers – reduce the number of cigarettes smoked each day, to eventually achieve the added benefit of healthy, non-smoker; 4) Strategically, plan your schedule and route of travel for errands, medical appointments, etc. (i.e., schedule and/or attend to appointments within a common geographical area) to avoid extra trips/miles, thereby saving funds required to purchase gasoline, as well as time and wear and tear on your car and body; and 5) Direct all bonuses and/or raises into your savings account, prior to receiving them for regular usage. The old adage -“out of sight, out of mind” is very valuable.
When the math is calculated for items one through four, savings over the course of just one week could exceed $ 25.00, with monthly savings in excess of $ 100.00. The outcome/savings from just one simple strategy (principal plus interest/dividends), over the course of 52 weeks could generate more than $ 1300.00/year. Implementation of strategies one through four could generate more than $ 5,200/year.
The best plan for long term increases in savings is to remember to avoid living beyond your means – the benefits will be realized and available, when needed!
Getty Images/Tetra images RF
