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Why it's never too early to think about retirement

Think of something that you do regularly now as a young adult that you would've never imagined doing as a little kid. It might be something big like graduating from college or nabbing a cool job, or as simple as actually enjoying vegetables. No matter what it is, most of us don't give a second thought as to how crazy our lives would seem to our former selves. But too often, it takes a long time before that sort of realization sets in. That's kind of how retirement saving works for many people - we can't imagine ever needing to retire, so we don't think about it until it's too late. 

Instead of missing the boat on retirement saving, it's better to get started now, no matter your age or financial situation. As you'll come to find out, saving for retirement is actually easier than most of us realize, and it's a huge step toward making our future selves a little happier.

Why save now?


If you're in your late teens or early twenties and plan to retire around 65 years old, that's something like two lifetimes away. In other words, just like studying for that final next month, it can wait until later, right? 

Actually, every day that passes while you could be investing in retirement is a day that you are basically losing money - a lot of money. That's because retirement savings in a qualified investment account earn interest that compounds (free money on top of free money). 

The New York Times put it like this: Let's say you have two people who want to retire when they are 67, and each saves $5,000 per year in their retirement account. One of them starts saving at 22, but the other starts at 32. In terms of retirement, 10 years doesn't sound like a lot of time, but it ends up costing almost half a million dollars. Seriously. That's the beauty of compounding interest, but it also explains why the perfect time to save is now.


How do I save?


If that's enough to convince you, you probably need a way to actually start saving now. There are many different types of retirement savings accounts available, but they involve a lot of weird acronyms and numbers. If you can look past all that for now, here are the two most common options to choose from:


  • An Individual Retirement Account, or IRA, is a popular option that's available to pretty much anyone who pays income taxes in the U.S. After opening an IRA with Trustmark or any other institution, you can save up to $5,000 per year and deduct the amount you contribute from your tax returns. Meanwhile, you'll continue to earn interest on investments.
  • A 401(k) is similar to an IRA, but it's only available through your employer. These are also tax-deductible and interest-bearing, but they come with some extra perks like the ability for your employer to contribute funds on your behalf. 


No matter the options available to you, the best advice is to start saving now and don't stop until you're ready to retire. For all the details in-between, talk to your local Trustmark representative to get more expert advice.