There's a new trend in saving.
More Americans are now putting away money for their own retirement over saving for college education for their children. Last year, the number of people saving for their own retirement was about even with those saving for their kids' higher education, according to Medill Reports.
Kelly Campbell, founder and certified financial planner of Campbell Wealth Management, told Medill Reports retirement is much more difficult to plan for than saving for college.
"People are realizing when you decide to retire, they don't have those same options (as you do with college fundings)," Campbell said. "As a matter of fact, it can be a little scary when you leave your employer and your steady paycheck."
Medill cited a Fidelity Investments survey of 2,027 adults around the country. More than half of respondents said they are primarily saving for the long term, with 55 percent of those saving for retirement and 35 percent saving for college tuition for their kids.
"People are expressing more concerns that they can't rely on outside sources like pensions and Social Security at the finish line," Mary Deshong-Kinkelaar, CFP practitioner and founder of Kinkelaar & Associates Co., told Medill. "And I think it's a good sign that they are being more responsible for themselves."
In the same boat
If you don't think you're making enough money to make a dent with a savings plan, Sharon Appelman, director of financial planing and income management with Francis Financial, wants you to think again."No two people have the same retirement goals and needs," Appelman told Fox News. "People with low incomes have to save proportionally, as do people who are making millions. They need to save enough to supplement their Social Security and maintain their lifestyles."The mindset of people with low and high incomes might be more similar than you think. American Consumer Credit Counseling reported 86 percent of individuals making $20,000 to $30,000 each year felt they weren't prepared for retirement. Meanwhile, 79 percent of individuals being paid $100,000 to $150,000 annually said they too felt unprepared for retirement.
Start saving early
No matter what your income is, American Credit Counseling's Katie Ross said it's important to start saving for retirement as soon as possible.
"Even if you're just saving just $10 a week, before you know it, you'll have a nice little nest egg," Ross told Fox News.
For example, if you save $100 a month for 40 years starting at age 25, you'll have nearly $200,000 - assuming you receive a return of 6 percent interest on that cash - by the time you're 65.
Get rid of your debt
If you hope to get serious about saving, the first thing you should do is wipe out any of your debt. Kevin Gallegos, vice president of a financial institution in Phoenix, told Fox News that eliminating high-interest credit card debt should be priority No. 1 for those who wish to make a savings impact.
"You have to look at where you are at with your debts, assets and liabilities," Gallegos said. "The tough part for anyone, but the part that needs to be taken care of first, is to get rid of that debt. Debt is going to eat away every bit of savings that you have. Your interest rates on credit cards are going to be greater than any interest you get from your savings. Get rid of your debt, then start saving."Gallegos also urged low-income Americans to be especially thorough when looking for ways to save. If that means foregoing daily Starbucks or a weekly trip to the mall, so be it. Spending too much on unnecessary items can devastate retirement plans.
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