Here are a couple of steps that are essential to having the confidence to retire.
1. Defining your retirement goals- The biggest problem for most people is that they don’t ever define what their retirements goals are. They don’t have a target so they never know once they’ve reached their goals. People must define what retirement life style they desire and what dollar amount could make that happen.
2. Make a road map-Once you have a goal, you need to create an action plan that will help you get there. This could include exactly what you need to save every year/month to fund your retirement goals. Don’t forget about inflation! If the current inflation rate stays steady, today’s money will only be worth half as much in 25 years.
3. Stick to it!!!- This is by far the hardest of the 3 steps. You have to have the discipline to stick to your plan. Millennial have an incredible opportunity because they have some much time before they retire. When it comes to investing, time is the most powerful tool. The more time you have, the more aggressive you can be and the more you can take advantage of compound interest.
Believe me, it is not very cool to save and invest when you are 26 and all of your peers are buying new cars and cool tech. But you will definitely be the coolest when you can retire 10 years earlier than all your peers. You have to have long-term vision to see past the here and the now. So many young people waste so many years of investing because they are busy buying all the latest toys.
If a 20 year-old only knew that saving and investing only $300 every month would grow to be more than $1.5 million by the time they are 67. The effort and discipline you put in now will pay you for the rest of your life.