Start Saving Early for Retirement
Start Saving Early for Retirement
While my husband just recently retired from the military, we started planning for retirement very early on. Military retirement pension is great, but we didn’t feel it was going to be enough by itself. We started investing $100 a month into a Roth IRA to supplement our military retirement and made sure to add to our monthly contribution every time he received a promotion or raise. Slowly and steadily our investments grew and are still growing. My husband is working a new job now and plans to retire completely by 50 or 55 thanks to our savings and planning.
This is my family at my husband’s retirement ceremony!
MilSpouse Money
Mission Response:
Congratulations on your husband’s retirement, Jamie! For most, retirement can seem like a long way off when you’re just starting out in your career but saving early on is key to take full advantage of compound earnings.
Three factors impact your ability to retire: how long you save, how much money you save, and the earnings on your investments. Most retirement plans focus on a target age of 65 so achieving that goal sooner like Jamie and her husband, typically requires starting early in your career so time is on your side and/or increasing your savings rate. Check out this short video for more on the power of time and compound earnings. Retirement is the most expensive goal most of us will ever save for. As a result, financial experts recommend saving and/or investing 10%-15% of pretax earnings throughout your working years if you plan to retire around age 65. If this seems like a lot right now, start saving what you can and increase the amount when possible. Consider making automatic contributions to make saving even easier. Your Service member can contribute a percentage of their pay directly to the Thrift Savings Plan. If you are covered under an employer-sponsored plan, like a 401(k), you can automate payments too. Even if you are not currently employed, it is important to save for the future. Contribute to an Individual Retirement Account (IRA) to help meet your savings goal. Stay on track by following your spending plan. You will find that putting a little aside each month will add up in a big way by the end of your military service!
Your spouse is retiring from the military, but it is your transition too! Visit our Retirement Milestone for more information and resources on how to prepare for this transition and new phase of life.
