Saving for retirement in a down economy is no different than saving when the economy is good. It may be a little more challenging, but it still takes discipline and long term planning to achieve your goal. After all no one wants to spend their golden years working at some fast food restaurant to make ends meet when they should be out enjoying life.
The first step is to figure out how much money you will need to meet your expenses after you have retired. Once you have come up with a reasonable estimate then it is time to lay out a savings and investment plan.
It may be hard when you are in your twenties to think about putting money back to retire on, but money saved at 20 is worth more than money saved at 50. Now you probably think I have lost my mind or something, but it is true. When you but money into savings at 20 it has 45 years to earn interest verses only 15 years for the money put into savings at age 50. Money that is earning 5% interest a year will almost double in only 14 years. So it would seem that a smart saver would put as much into retirement at an early age as they can. A thousand dollar put into savings at 5% when you are 20 will be worth $8557.14 when you retire verses a thousand dollars put into savings at age 50 which will only be worth $2078.92.
We all have things that we can trim from our budgets to make saving for retirement easier without affecting our lifestyle very much. So sit down and look at your budget to see where you can trim some of the fat. Maybe you rent movies every weekend, when subscribing to one movie channel or having an online movie subscription would be cheaper. One of the easiest ways to save money in cutting back on the number of times you eat out each week. How much does your family spend each time they eat out? $30, $40, or even $50, think about how much money you could be saving by simply eating out one less time a week.
Since regular interest baring savings accounts are not earning very much these days, check into interesting your money in long term CD’s that have a higher interest rate. Be sure that money you invest is not money that will be needed for other expenses as there will most likely be a penalty for early withdraw.
Your best course of action would be to consult a respected investment consultant. They will have a much better grasp of what solid investments are out there and which ones pay the highest yield. Stay away from get rich quick schemes, if something looks too good to be true it usually is.
Retirement does not have to mean that you have to live on a fixed income or that you have to move in with your daughter and son in law in order to survive. All it takes is a little planning and discipline to make you golden years exactly that, Golden.