What’s the Best Age to Start Thinking about Retirement?

Retirement is an important topic, especially as people get older. It may seem like worrying about retirement is only for older people; however, this is a common misconception. While most people can’t retire until they are in their sixties or seventies, thinking about retiring should start as soon as you start working. The government benefits for retirees is simply not enough, so people need to think of new ways to save money toward retirement, and they need to start early.

Planning for Retirement Early

Many companies offer retirement plans such as 401Ks and IRAs. Many times, companies will match a certain percentage of the worker’s investment into these plans. That is free money for your retirement. If you start a plan early, that’s more money that you and your company are putting toward your retirement. Even people who are not able to use a work retirement plan can start their own IRA or 401K. The sooner you start adding money, the faster you can retire and the better life you will have. For example, if you start saving at 25 and save 15.4% each year, you can be financially independent at age 65. However, if you wait until you are 35, then you have to save 30.1% a year to reach financial independence by age 65. That’s about twice as much for only missing 10 years. That is why starting planning now is so important.

Social Security

As you’re working, the government is taking some of your money and putting it toward social security for when you retire. The longer you work and pay into social security, the more credits you earn. Once you have enough credits, you can retire and receive social security benefits. For some people, the benefits from social security might be enough for them to live comfortably in their retirement; however, social security was never supposed to be the only source for retired income. While, social security makes up about 40% of the individuals average wages, they still need to find a way to replace the other 70% in order to continue their lifestyle. Most people do not need to worry about social security as long as they work on a regular basis. The government automatically takes money and gives them credits. However, for the remaining 70%, workers need to take matters into their own hands.

Savings and Retirement Plans

While, you don’t need to worry about social security at a young age, as long as you are working continually, there are other retirement benefits to consider. These benefits need to be started early in order to get the most money in the smallest amount of time. Starting saving early lets you put more money in sooner and compiling interest faster. Many people try to put money in their savings to put toward the future. Savings accounts usually accrue interest, and are a great way to save and grow money. However, they do require self-control because it is so easy to pull out the money and never replace it. Retirement plans like IRAs and 401Ks are a great way to set money aside without the risk of taking it out. There are many rules set around IRAs and 401Ks, so that people are only able to withdraw money for retirement. There are a few special circumstances that will let people withdraw early, but they often have to pay heavy taxes and penalties on the money, making it very unappealing


Waiting to think about retirement is a big mistake. Even waiting a few years could cost you thousands in interest. Starting early means that you have to put away less money each year, but you reach your goals faster. Social security is not the only benefit you should consider. Retirement plans and savings are also important, but they need to be started early in order to reach the best pay-out possible.

Author Bio: Nisha represents a site called MHA.org.uk. She enjoys writing about elderly health and dementia care.

Comments 1

  • Very true you mention in your blog. It is very important to
    take care few points before taking retirement community.

Leave a Reply

Your email address will not be published. Required fields are marked *