Choose Your Future with Either Saving Money Strategies or Wishful Thinking
AARP’s “Nickel Builder” strategy may be one of the best saving money strategies around. It’s simple and effective, and that is often the key to momentum.
The headlines constantly scream that you’re not saving enough money for retirement. But sometimes you don’t get workable suggestions on ways to make steady progress toward savings goals. Instead, the onslaught of financial information can be paralyzing.
Procrastination Is Often the Biggest Problem
So, how do we get off the “dime” (pun intended)? Well, I never could accept the fact that a small start could result in a big finish. Maybe you’re that way.
Or, I would always rationalize that I would make it “big” in time — no need for saving money strategies now. Have you been there? And now you’re 55, and that ship hasn’t come in yet. Panic time.
That’s life for many of us: no plan and plenty of pain later. But there’s hope . . . even at age 55.
This won’t make you a millionaire if you start at 55, but you might be blowing more than $18.25 a day on booze or even Starbucks. Think about it! Would an extra $122,855 come in handy when you retire at 75 by starting out with a nickel today at 55? Well, here’s how you can do that if you can get 5.5% interest:
This money-saving trick is especially useful for those of us on a budget.
Here’s how it works: You start by saving a nickel the first day, ten cents the next, and keep adding five more cents each day for an entire year. You never have to save more than $18.25 on a single day. At day 365, you end up with $3,339.75.
For many, the plan (http://bit.ly/2sPF456) is doable and practical. And it may help you banish those fears about cat food dinners during your senior years.
You Need a Vision. Is my twist on this a vision, or what?
Here’s my plan for you:
- Establish a deposit account that pays 2% interest.
- Start with a nickel today at age 55.
- Add a nickel every day for 10 years.
- Withdraw $134,000 at age 65.
- Retire to Abruzzo, Italy / Las Terrenas, Dominican Republic / Medellin, Colombia / Carcassonne, France / Algarve, Portugal / George Town, Malaysia / Tralee, Ireland / Cayo, Belize / Chiang Rai, Thailand / Puerto Vallarta, Mexico and live like a king/queen until you’re 132.
- The biggest daily deposit in your first year would be $18.25.
- If you deposited monthly, the largest monthly amount would be $518.25 in the first year.
- The largest monthly deposit (in your 10th year) would be $5,445.75. That could be chump change by then. And six days later you retire.
If you want to see the details of this plan, download my spreadsheet here.