Written by Kelsey, May 05, 2010

I was talking to my dad the other day, who is 54, and he said he has no retirement! He had an injury 10 years or so back and said he used it all up. I don't know if he has a plan in place but I don't really know to exactly say that I don't want to be the one responsible for him.

Written by Christy, May 05, 2010

I've researched this for some of my clients (financial services cos.) and the statistics are scary. Most people will need way more than they think in retirement just for basic expenses. And then there's all of the unexpected potential expenses (e.g., out-of-pocket health care) that can break you. Even if you start out saving a little bit consistently when you're younger, it can make a huge difference in how much you end up having saved for retirement.

Written by DD, May 05, 2010

This is a subject that is dear to me. Many experts suggest that with the amount of debt that I have, I shouldn't be contributing to my retirement plan. However, I disagree. I cannot get these years back in terms of compound interest. So, while I could be using the money I am contributing to accelerate debt payments, I rather max out my 401(k) which reduces my taxable income and ensures that I won't be financially dependent in my retirement years. It's a very fine and PERSONAL balance.

Written by Shari, May 05, 2010

This is very true. But what about people like me who are unemployed and have so much debt that you can not even save $1 a day. The unemployed do not qualify for a IRA or a 401K.

Written by Lauren, May 05, 2010

My dad actually highly recommended when I was 18 that I start a Roth IRA. Initially he helped my make the max contribution which is $4,000 and then after that I make a yearly contribution myself. Watching it over the past few years has been interesting, but I must say even though I am only 23 it is nice to know that I am already planning for later. Plus just a few months ago I began participating in the 401K plan offered through my job. Here is my recommendation ladies. If you are young and can afford to put away a little extra every paycheck DO IT! Put in as much as you can, I put in 12% every week, and I also opted for a high risk account(I sought out financial advice) and I picked what types of funds I wanted my money invested in. It is soo worth it, and if you are young, go higher risk, you have more time to save, take the risk while you can when you know you don't have to retire on it in 5 or 10 years. It is soo worth investing in yourself for your future retirement. And any amount is good, it doesn't have to be a lot. Even a little planning now could save a lot of hassel later!

Written by GR, May 05, 2010

All great advice ladies. What about Stay At Home Moms? As a previous post mentioned, we may not have the same saving opportunities as working moms. Anyone care to comment? Thanks.

Written by Kenia, May 05, 2010

@Shari and GR: Check out www.Sharebuilder.com. Because you purchase shares of mutual funds, and not whole shares, the minimum investment amounts are small. This is great for small investors. Sharebuilder accounts also come with a money market savings account. So let's say you want to invest in a mutual fund that requires $100 minimum to invest, but you can only set aside $10 or $20 per month (hey, it's small, but it's SOMETHING, and it's better than nothing!), park that cash in the money market fund until you build up the $100 you need, then make the mutual fund purchase. I recommend a no-load, NTF (no transaction fee) mutual fund (translates into: no commissions or fees!), and sharebuilder also has some mutual funds that are tax exempt! (So even though this is not an IRA or 401K, where you can contribute tax-free dollars, at least you won't get taxed when you have gains in your portfolio.)

Written by Susan, May 05, 2010

I am 57 and have been contributing to an IRA since I was in my early 30's. I am in the very middle of the middle-class. During the economic recession of the 80's I lost more than half the value of my IRA. It took 10 years to build back up to what it was. Then I invested $10,000 in a stock that turned out to be a scam. The prospectus looked good, I showed it to my financial advisor and he agreed. Then poof! Hundreds of millions of dollars disappeared. I felt "lucky" only losing $10,000. The feds caught the smaller fish and put them in jail. The big fish are still living off our money overseas, and I am sure they have never looked back. I have recovered from those losses and now also have a portion of my IRA in a self-directed account that allows me to invest the money in our family business. I am earning 8-14% on that money and believe that by the tine I am 65, I will have matched the total current value of my other, "safer" IRA account. My ideal is to keep working beyond 65 because I love what I do. But I want to be able to retire if I have to and live comfortably. So far, I am in good health and that should be possible. I cannot stress enough to younger women, save, save, save - even if it is just a small amount. The advise I received is, "Always pay yourself first."

Written by Carla, May 05, 2010

Couple things 1.) stay at home moms or any women who feels pressure from their significant other on this: when you get groceries take cash back on your debit card and walk over to the bank in the grocery store to deposit it in an account in your name. When you get the min. investment saved, go for the mutual fund option described above, again in your name. (I'm sure Daily Worth will address the "in your own name" topic soon)
2.) I'm 45 and I still have the envelope my truck driver Dad did the compound interest math on for me (by hand) when I graduated college. $500/yr is what he started with. When I was making $17k/yr it was hard to commit to, and some years it was only $50. Flash forward 20 years. It has made a HUGE difference. My husband (a CFO)and I have both been underemployed/unemployed for the last 14 months and we've had to dip into our retirement reserves. It's not pretty, but it's better than selling the house in this market. Once we are re-employed we will have to work hard to restock our savings. It's gonna suck, but we won't skimp because it has saved our butts this last year. Luckily we did the same w/ the kids college accts, the interest is working for us even though we can't make contributions now. Every little tiny bit helps; you are worth it.

Written by Sue, May 05, 2010

I believe many women have been and are aware that they do need to take care of themselves. I started my career (after a divorce) at 34 and saved, saved, saved. I am 57 now and only working part time until I am 62 and can collect SS early. No fancy gimicks here. Just saved 50% of my pay (no, I did not earn a big salary) and put it into laddered CD's. No way was I going to risk losing one cent of my hard earned money. Lived far below my means, paid my small house off in 5 yrs and now have more than 1 mil in real estate and money for retirement. My COL is lower because I choose for it to be. It can be done. In fact I would say that all of us women are more capable than men when it comes to money. BTW-I remarried 14 yrs ago and taught my husband how to save as well. He is 64, retired (works a little part time) and has over $200,000.00 saved. He did not have a dime saved when we first dated, but also did not have any debt. I knew he could do it. His SS completely takes care of his bills and we have money to splurge a little.

Written by Joyce Marie, May 05, 2010

I think it's pathetic that more women are not on top of their own finances. Anyway, I believe that it will take alot more than 1 million dollars to retire. Of course, it depends on if you have other income generating investments like rent from real estate or another business. If not, and you're planning on living on interest from your savings then good luck. 1 million dollars will pay you around 20-25,000 today (unless you're willing to take risk) and that plus your social security check will probably not keep you living at the standard you are used to when you retire. Not to mention what a good nursing home costs these days if you would ever need one! I'm lucky because I come from a family of savers and even when I made really good money in my prime years, I socked money away. I wish more people were more responsible!

Written by Jaime, May 06, 2010

I'm only 32, but I worry about my retirement. My 401k bounced back from the downs of last year, but it's still pretty modest. Luckily, my parents have always been very frugal and very focused on a fully-funded retirement. I don't worry about them at all really and that is a big relief. The problem I have with my own retirement planning is the fact that I tend to prioritize other things ahead of retirement savings because I feel that i have time to make it up. I really need to save for so many things, at this point I need to boost my earnings more if I want to fund my savings better. I also need to set a higher minimum for retirement savings, make it more of a priority if I want to have the same peace of mind as my folks.

Written by Debi, May 07, 2010

I am self-employed (couldn't find a job after searching for a year), making very little, and have very little saved for retirement. I live simply with low monthly expenses.

Single after years of staying home with kids or working for EX-husband. He didn't believe in a savings or IRA for me and wouldn't support it. Thank you for the info about sharebuilders. Until now I have had no idea what to do! I'm 52 this week and could sure use more advice, please. Thank you so much!

Written by Petunia, May 10, 2010

Debi - A great way to get started is to use a Target Retirement Fund. With your very first contribution, you have a diversified portfolio of stocks and bonds, foreign and domestic, large and small, growth and value.

T. Rowe Price, Vanguard, and Fidelity are all reputable no-load fund families. At T. Rowe, you can get started with $0 if you sign-up for automatic contributions of at least $50 per month. At Vanguard, you need at least 1k to open an account. I am less familiar with Fidelity. All 3 have websites, all 3 offer Target Retirement Funds, all 3 offer both traditional and Roth IRAs.

Best of luck to you.