Grow Your Retirement with Just $50 a Month

We all know that retirement investing is important. But, according to a recent survey, 56% of Americans have less than $10,000 saved for retirement. So, how do you carve out enough money from your budget to really grow your nest egg?

“The important thing is to get started—no matter your age,” says Matt Meese, wealth management sales manager at Mountain America Credit Union. “Not everyone has access to a 401(k) or company match and some people have high-interest debt that is monopolizing most of their discretionary funds. Don’t get discouraged. Make saving a priority and do what you can—anything is better than nothing.”

Your monetary needs in retirement may seem like a big, unreachable amount, but speaking with a financial advisor can be incredibly helpful. If you want to start the process on your own, find just $50 in your monthly budget to kick start your savings. Then, increase your contribution more in the future—whether that means trimming your budget or getting a better-paying job.

You may be asking yourself, “How can a measly $50 a month impact my retirement savings?” The benefits could actually be significant! Thanks to compound interest, the earlier you start, the bigger your account balances will be.

Let’s say you save $50 a month in a shoebox. After 25 years, you’d have a grand total of $15,000. If you invested it and earned just 5% dividends, that $15,000 would turn into more than $28,000. Imagine how quickly your savings would grow if you worked for an employer who offered a company-match program for your 401(k)!

Here’s an example of how $50 a month can grow in different types of accounts:

As you can see, the further away your savings goal, the more likely your money will prosper. Meese advises, “If you question your money management discipline, automate your $50 monthly savings contributions instead of relying on making payments manually.” 

Bottom line: Start saving for retirement as soon as you can and choose the savings vehicle that works best for your lifestyle.