With all the costs that are associated with living in the modern day United States, saving for retirement can be put on the back burner in comparison to mortgages, student loans and the costs of everyday living. One of the only ways to be successful and build a substantial retirement is through hard work and diligence. It take the time and dedication of setting goals and keeping them in order to better build your savings as well as make your money work and build on itself.
Drop the Unnecessary Extras:
There are many extras that the average American indulges in daily that have a large total cost annually. Expensive upscale coffee is one of the worst culprits of superfluous extras that Americans spend on. It was found that on average American’s spend around $1,000 a year on specialty-brewed coffee. By switching over and brewing coffee at home and in the office, you are already saving more money. Television and Cable T.V. is another expensive culprit. There are many alternatives to spending large amounts of money on a monthly basis to watch all your favorite shows. With companies such as Netflix and Hulu Plus, there are cheaper alternatives to being able to watch the television you want when you want it.
Pay Off Your Debt and Save the Extras:
Paying off debt is one of the most important aspects to securing a retirement fund. The average American carries around $7,500 in credit card debt annually. By paying off the debt Americans will be saving the money that is spent in interest. Once this is done, generating a savings account to keep all the money that you are cutting and saving in high interest bank account. This allows the money that you are saving and not touching to work and make money on itself through interest rates driven by the banks.
Invest Your Savings:
One of the best ways to generate a larger retirement savings is through investing. One of the safest investments that you can make are I savings bonds. They are issued by the U.S. treasury and backed by the United States government. A unique aspect of this type of investments is that they are indexed to inflation so they retain their buying power. The stock market is another great place to jump in and invest your savings, but not without the help of a brokerage and a little research. On average long term stocks have outperformed and you can manage risk and volatility by investing small amounts each month in an index fund.