How to Start Saving For Retirement in Your 20s

Saving for your retirement is one of the most important goals for Calgarians. Apart from purchasing mortgage life insurance, here are the top ways to start saving to protect the future well-being of you and your family. 

While investing in products such as mortgage life insurance and consistently saving money might not be glamorous, it will give you much more freedom and control over your lifestyle down the road. Meeting your retirement savings goals can have many benefits:

• it gives you a better quality of life as you grow older and helps you stay independent.
• it allows you to financially help out your family, such as grandchildren if you wanted to.

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4 Ways to Start Saving For Your Retirement In Your 20s

It’s true that saving, especially when you are in your 20s and 30s, requires an enormous amount of effort and while it’s easy to put off until later on in your career, saving for your retirement needs to be a priority as soon as you start earning an income.

If you want to enjoy greater financial independence as you age, here are some easy ways to begin saving:

1. Start Saving Today

When you’re in your 20s and 30s, it’s easy to find plenty of reasons not to save your money, especially if you’re struggling to pay your rent or pay off student loans. But letting your expenses become an excuse is a huge mistake.

Here are some easy ways to start saving today:

• cut your expenses
• pay off your credit cards every month
• participate in your employers 401(K) savings plan
• establish some real-time financial goals
• open a savings account with your bank and open another at a different institution
• pay into your savings accounts right after each pay day
• set up auto transfers to your savings account
• nickname your savings accounts ex: "Tokyo Trip 2019"
• planning your meals out eg. frequency (be mindful of special occassions like birthdays, anniversaries etc.)
• use October to try a cash diet to monitor your spending

Remember: The longer you put off saving, the more it will set you back in the long run, so don’t wait until you’re preparing to leave the workforce to start saving for the future.

2. Clearly Define Your Goals

Some people want to start saving, but they don’t know where to begin. This is why it’s important to start setting specific and realistic goals. Once you decide why you’re setting aside part of your paycheck, deciding to save rather than spend the extra money becomes easier.

Tip: Make sure you have enough money to set aside to meet your immediate and future needs. Some of these goals can include:

3. Start Budgeting

If you are trying to develop better financial habits to save up for your retirement, it’s critical to know where your money is going after each payday.

You should consider:

• keeping track of what’s going in and out of your bank account
• developing a spending plan
• coming up with a method that will help you keep tabs on how you’re spending your money
• reducing your expenses (eg. making your own coffee at home or taking public transportation)
• getting insurance ie renters, mortgage life insurance, extended healthcare, etc. 

REMEMBER: While no one enjoys tracking their expenses, it’s an extremely important undertaking if you want to understand what you could potentially save and what changes you need to make in your spending habits.

Household Budgeting

4. Just Say No

Using the word No is one of the simplest and most effective ways of saving money and building up your retirement fund. If you’re tempted to spend more money than you should, then you should walk away.

While there’s nothing wrong with enjoying life or going out with friends and family, turning down invitations every once in a while and limiting the number of days you go out will eventually pay off.

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For more saving tips, or to find out how our flexible and customizable mortgage life insurance products can help financially protect your loved ones, contact us at 1-866-821-1439 or fill in our online contact form.