General Discussion
In reply to the discussion: "I live on $710.00 a month, what exactly am I supposed to cut?" [View all]Honeycombe8
(37,648 posts)I see young people spending recurring amounts on electronics, digital music, contracts for phones, etc. For them, their retirement is so far in the future that they are not concerned about it. I wasn't either.
But during those young years is the opportunity to put away a few dollars here and there, to save for the days when they are no longer young and healthy.
When they already have an iPhone, dated though it may be, they should think about putting that money away instead of getting the newest iPhone. Instead of paying for a contract phone, consider a pay-as-you phone (you can get smart phones for those, too). Instead of digital music, listen to music for free. It's on the radio. You can get by w/o listening to your digital music in the doctor's waiting room or on the elevator.
Even poor young people can sock away a few dollars here and there. Over decades, that money will grow enough to make a difference in cases such as the original OP.
There are savings calculators on the internet that will tell young people how much their savings will grow over the decades. Saving $20 a month for a 25 year old, on average (assuming some months will be less and some will be more), at 2% intereest (knowing that this low interest will surely grow in the future, so this is a low ball), the 25 year old will have about $15,000 in savings to help a bit starting at age 65. This would give her $50 extra a month for 25 years, at least. Probably more.