Many Americans think they can't save money, or that saving for retirement is too difficult. Take a look at these common excuses for not saving and learn how you can work around them.
“I don’t have any extra money to save"
You may think you can't save money, but ask yourself - are you living paycheck to paycheck? Try making a list of everything you buy each month and look for places to save. Stop buying your coffee every morning and make your own. Eat out one less time each month. Watch movies online instead of going to a movie theater.
Cutting back on everyday purchases is one of the easiest ways to find extra cash to funnel into an investment account.
“I don’t know anything about investing"
Investing can be complicated, but you don't have to go it alone. An investment professional can help you design an investment plan to fit your goals and risk tolerance. If you contribute to a 401(k) or other Retirement Plan at work, your employer may offer educational programs that could help.
There are many resources that can help you understand financial principles and investment basics. Just keep in mind that investing involves risk, so there's no guarantee you'll reach your investment goals.
“I want to have access to my money”
Many investments are liquid, which means they can be turned into cash quickly. These include Treasury bills, money market funds1 and other short-term investments. The drawback is that liquid investments often don’t keep pace with inflation.
Stocks and stock mutual funds typically have higher returns. Even though they aren't as liquid, you could choose to sell your shares. Or you could borrow against your assets if your brokerage firm lets you.
“It’s too late to start saving”
It's never too late to begin investing for your future financial security. Whether you're five or 35 years from retirement, boosting the amount you're saving may help you reach your goals and stay on track for retirement.
Take 10 minutes to use our My Interactive Retirement Planner to help you set retirement goals, track progress and find ways to improve your retirement outlook.
Of course, the sooner you start the more money you'll be able to potentially accumulate. And the more you accumulate, the more you can earn through compounding.