Saving for Retirement

This is a guest article by Flexo, the creator and owner of Consumerism Commentary, one of the most respected personal finance blogs. Flexo writes about investing, banking, saving and many other financial topics. Take a look at his picks for the best online savings accounts.

Thinking about retirement is quite cynical.

If you listen to financial planners, the moment you receive your first paycheck, you need to be thinking about and saving for retirement. From a financial point of view, this makes complete sense; the best way to ensure you can afford to retire when you want is start saving the very minute you have an income. Look at this a little deeper; the message they’re communicating is that once someone takes his first step on a path to discovering the type of work he’ll do for the rest of their lives, the activities that will rule his waking life and come to define him, the primary thought should be about ceasing that adventure.

There’s something we’re missing here. The typical retirement plan for middle-class America most likely involves moving to a comfortable location and relaxing. Today’s retirees live several decades, though, and by the time I’m of “retirement age,” my generation could be living forty to fifty healthy years after the official, government-sponsored date of retirement. Most people have enough trouble saving enough money to last thirty years in retirement; what happens in that extra decade or two after the money runs out?

Conversely, the probability is low, but one has to consider not making it to retirement age in the first place. If the worst does happen, the money you’ve saved for retirement will go to your beneficiaries, but that wasn’t your real plan. You were putting money aside because you were looking forward to the time you could stop putting your life on hold and start living. Only in rare cases is live ever longer than we want it to be. For most of us, life is cut short before we are ready.

I can’t stand around and watch people as they blindly listen to financial advisers and columnists who advise others to save as much as possible for retirement at the expense of living today. Most people are not going to be able to save enough to retire at an extremely earlier age than normal, like thirty, to be able to take advantage of the sort of free living associated with retirement at a time when they’re youthful and ready to enjoy all that life has to offer. That’s why it’s important to find ways to enjoy life now, even while working, while putting some money away for the future.

One of the best ways to tackle this is to leave the middle-class cubicle or middle management job behind. Seek a vocation that you enjoy, something that makes you feel alive. Failing that, or possibly in addition, fill your life with people, hobbies, and other activities you love.

We concentrate so much on saving for retirement that sometimes we forget that we need to continue living throughout our entire life, not just our later, less mobile, years. So how much should someone save for retirement? As much as possible while still having the chance to enjoy her short life today.