Tuesday, December 11, 2018
MERS CentsAbility Blog

 

Hey Millennials! Think it’s too early to be thinking about your retirement? Think again…

Hey Millennials! Think it’s too early to be thinking about your retirement? Think again…

2:03 Min Read

When you're in your twenties and just starting out in your career, saving for retirement might not seem that important. It can be hard to save for retirement when you have so many other demands on your money. But getting a head start on saving while you're young could have a significant impact on your future financial security.

Starting Your Career

If you've just started your career, you may be earning more money than ever before. But you could have new expenses, too. If this is your first time living on your own, you're now the one responsible for paying for rent and utilities, groceries, gas, insurance, and all your other living expenses. Plus, you may be paying off your student loans and saving to buy a new car. Setting aside money for a distant retirement might not seem to be a sensible thing for you to do right now. But this really is the ideal time to save even with small amounts.

Time Is on Your Side

Saving for retirement while you're in your twenties will give your savings more time to grow through compounding interest. Compounding occurs when investments generate earnings and the reinvested earnings generate more earnings. You therefore have the potential to earn returns on your contributions and your earnings. The longer the compounding process has to repeat itself, the larger your account balance may be at retirement.

Your MERS 457 Program Makes Saving Automatic

Saving for retirement is very convenient with your MERS 457 Program. You don't have to make a special trip to the bank or write a check each month. Your contributions are automatically deducted from your paycheck each pay period and put into your plan account. Because you don't receive that money, you aren't tempted to spend it instead of saving it. Try to increase your contribution whenever you can.

MERS Makes Investing Easy, Too

If you don't know anything about investing, that's okay we are here to help! You don't have to be an expert to get started. The MERS Retirement Strategies funds are our default investment option, and they make investing easy.
Each of the MERS Retirement Strategies is a complete, diversified investment fund that includes stocks, bonds and other diversifiers that are selected for you based on your expected retirement age. These funds are known as "target date" funds. The fund's management team automatically adjusts your portfolio mix according to your target retirement date, investing more heavily in stocks while you're young, and moving to more conservative options as you approach retirement.*

Ready to start thinking about retirement? Our 457 Savings Calculator can help you get started.

* Investments in Retirement Strategies are not guaranteed against loss of principal: at any time, your account value can be more or less than the original amount contributed – including at the time of the fund's target date. Also, investing in Retirement Strategies does not guarantee you will have enough income in retirement.


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