College grads, start saving now!

When I graduated from college I was 21 years old and 5 months pregnant. I had other things on my mind than saving for retirement.  .  . like rent, food, graduate school, paying off the hospital and doctor bills (it was a pay as you go baby).  I put it off until I was about 48 and the children were launched.  Then I opened a tax deferred account through TIAA-CREF and started setting aside the maximum allowed.  Since I didn’t go back to work full time until about that same time, I was really behind.  If you’re starting out, don’t do what I did.

Here's how interest compounds over time: If you save $10 a day at age 25, you'll have more than $1 million by age 65, assuming an 8% annual rate of return. If you start at age 35, you'll have $445,000. At age 45, you'll only have $180,000.

http://online.wsj.com/article/SB10001424052702304432704577348052844503384.html

Media hype wrong again

Cross posted at Collecting my Thoughts

So much for all the gloom, doom and disaster the media were promoting. Who are their sources? The people went out on Black Friday and increased spending by 3% over last year. And for once I'm glad. The jobs they saved may be their neighbors or their own. Now we'll get all the qualifying stories from the journalists and consultants who got it wrong. The "yes, but," excuses.

Anyone in retirement years can see we're heading for a bad time, just open your latest statement. It's not like 2004 when the Kerry/Edwards campaign continually bad mouthed the economy for over a year, Bush, new jobs, etc. and the media chimed right in. It's not 2006 when the Democrats took over Congress by campaigning on the bad economy (that wasn't) and then rode it into the ditch by making no corrections the president wanted. The week after the 2004 election it was all good economic news again. Because we don't have time for it turn around like it did in the late 80s, and the late 90s and after 9/11, it's going to be a challenge for retirees--especially if they don't fix that 70.5 age for drawing down IRAs based on Dec. 31, 2007 balances. People my age didn't grow up expecting everything, so we are probably better off than the younger boomers who thought life would always be a bigger house, or a new leased car every other year, or a vacation in Aruba.