Controlling the uncontrollable: Part II

#1 Savings

This is an item that regardless of your outlook on retirement, you have 100% control over.  Despite the drumbeat of headlines highlighting 401K investors inability to save at high enough rates, the talking heads constantly talk about the next stock market drop or market bubble.  These decisions start early in a retirement investors career and are habits that are formed early.

The financial education community has done a great disservice to investors we think in terms of how this issue is discussed.  If you have ever sat in a 403b education meeting, you know that the presenter talks about getting your coffee for free at work versus that trip to Starbucks or brown bagging that lunch.  Those are important items without a doubt but they don’t allow you to save larger chunks in your employer retirement plan.

If you are young and living in a higher cost of living area, what about having roommates versus living alone?  What about exploring debt reduction strategies for your student loans or credit card debt?  If you live near your parents home and they are willing, what about presenting them with a proposal showing them how living at home rent free will allow you to pay of those debts sooner?  A reasonable approach like this will free up large sums of money to invest while not having Mom & Dad on the hook indefinitely for your living arrangements.  #401k, #403B, #457b