After all they still have a lifetime to get around to that.
Before they get there they need to graduate high school, graduate college, get a job, get married, have kids, and buy a house – just to name a few.
Yet the number one problem most people face when they start saving for retirement is that they did not start early enough. Thus causing them to have to play catch up and save big dollars!
Maybe if we talked with our kids about saving for retirement then this would no longer be an issue, and maybe as a bonus we would start saving for our own retirement.
The following three items will help you with the conversation on long term savings for retirement.
Why It is Important to Save Early
The earlier you begin to save the less you have to save. This is the magic of compounding. When you set money aside it grows and creates dividends and interest. These are then reinvested back into more investments.
This growth is called compounding and allows your money to grow on its own, so you need to set less aside.
If you get your kids to save right out of college, or earlier if there is money, they will drastically reduce the amount of money they need to save. This will allow them the opportunity to have more choices and flexibility in their future.
Throw on top of this the fact that we are living longer and we need to find a new vision for retirement.
Instead of teaching our children about saving for decades and then retiring to “do nothing”, we should educate them on creating a future for themselves that involves them being financially independent. This means that they have the investments to be able to cover their expenses without working.
Once they have achieved financial independence then they can decide when to retire, decide which jobs excite them, move where they want and more.
In short they are in charge of their future – not their boss!
I don’t know about you, but not only do I want this for my child, but I want it too!
By starting your kids investing for retirement now you can help your kids achieve this.
Start With Teaching Investing
One of the biggest reasons people don’t begin to save for retirement is that they don’t know how to invest.
Many people are scared and have no idea where to start, so instead they just delay the saving part.
Instead help your kids learn about investing as soon as they are mature enough. If it is a regular activity for them, then there won’t be an education hurdle to overcome when it is time to save for retirement.
I created a guide to help you teach your kids about investing, so go ahead and get started teaching them today. Steps to Teaching Your Kids to Invest
Not only will they be thanking you at retirement, but hopefully that plays out to you not having to take care of them in your retirement!