Delaying Gratification

By Lila Quintliani, AFC®

Military Saves, Assistant Coordinator

I heard a statistic I found really shocking the other day:  according to the Center for Retirement Research at Boston College, 50% of 60 year olds have less than $37,300 in their retirement accounts.  As you might guess, that’s not nearly enough to live off of in retirement. In fact, according to the Boston College analysis, Americans are a collective $6.6 TRILLION dollars short of the amount they need to retire.  I don’t know about you, but I don’t plan on working to age 75.  Nor am I counting on Social Security (or any type of pension) to make up the entire shortfall.  The only solution I see is to save now for later.  My husband and I are consciously not living to the full extent of our paychecks now.   We are delaying gratification for the sake of a nebulous future that we are only starting to be able to visualize.  And I’m here to tell you, sometimes delaying gratification really stinks.  So sometimes we *do* “live in the present” – we go on vacations, or buy gadgets, or go to a Broadway play.  But always, always, we are socking away a part of our pay.

I realize it’s tough to save in today’s economy.  It’s also tough to save when you’re starting out, and not making much.  But if you make it a habit, and commit to saving even a small percentage of your salary, then you’ve made a start.  You can always bump up the percentage later on.

 

Look at your expenses. There are certain things you have to pay each month – your rent or mortgage, your car payment, your utility bills.  But then there are all those other things: iTunes downloads, meals out, random purchases at the mall.  Those are the things you can cut back on.

Make a commitment. Now that you’ve found a few “extras” you can cut back on, commit to an amount each month, whether it’s $20 or $200.  Don’t feel like you’re depriving yourself: in fact, you’re going to be giving the money back to yourself in the future.  Because it’s YOUR future you are saving for.

Make it automatic. Don’t leave it to chance – arrange to have that “extra” money go into a separate account each month.  Ours goes straight from our paycheck via direct deposit to our savings account.  You can also take advantage of one of the six discretionary allotments that servicemembers can assign on their LES through MyPay into a savings account. This way your allotment comes out of your entire monthly pay and then the rest is split into two payments (on the 1st and the 15th).

If you don’t have an emergency fund built up, use this money toward that first.  Once you have built up $500-$1000 dollars, you can tackle your debts if you have them and then keep on saving.  But always delay a little present gratification to save for your own future.

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