Herald Journal Columns
May 29, 2006, Herald Journal

Do you have a plan or a TV?

Given the choice, would you rather have a shiny LCD flat screen high-definition television set and be starving to death, or would you opt to put that money towards groceries?

The answer seems simple, unless you are a movie buff who considers it torture to watch “The Lord of the Rings” on a 25-inch screen with (gasp) no surround sound.

However, sometimes the choice between the essentials and luxury sneak up on people, particularly my generation – whose members likely won’t notice they’re sabotaging their well-being until it’s too late.

It all comes down to two things 20-somethings love to dream about, but are secretly scared to death of: the future and finances.

You have a better chance of making a snowman with the devil than corralling a graduate student into committing to a retirement fund.

Well, maybe it’s not that bad, but the problem is, we young ones have it rough.

Skyrocketing tuition, a tighter job market, and more emphasis on the expensive education needed to squeeze into that job market, force many of us through our 20s with nary two dimes to rub together.

When we do get two dimes, we are so elated that visions of trips to Europe and a new Ford Focus dance in our heads.

By our 30s, the time we reach the top of the hill in search of financial stability, we start to understand why it’s called being “over the hill.”

Instead of basking at the top of the mountain we spent the last decade furiously clawing up, we are bogged down by bills, mortgages, children’s expenses, and other responsibilities that send us sliding down the other side.

As retirement looms closer, we scramble to save as much as we can before crashing into the rocks at the bottom.

And, of course, there will be our own 20-something children in their search to find stability. Meanwhile, we will be their official ATM, without fees.

Paints a lovely picture, doesn’t it?

I can hardly wait to get started.

Here’s the catch: It doesn’t have to be that way.

There are ways to help prepare for the future, no matter what age you are – although it’s usually a good idea to start planning for retirement before you hand in your final two-week notice.

I find that many people my age don’t really think about saving for retirement immediately.

Most people have a plan to start “sometime.”

Maybe after they’ve bought a house, or gotten married, or snagged a better paying job.

But even if you live in an apartment, haven’t had a date in a year, and are flipping burgers for a living, you can start preparing now.

The next question is, why would you want to?

I’m a planner. I like to have all my ducks in a row, even if the lake is a little choppy.

If that’s not your bag, then think of it this way; do you like worrying about money? Because if you don’t like doing it now, chances are you’re not going to like it in 40 years, either.

Stashing away $150 a month now, could mean the difference between spending your golden years basking in the golden sunshine, or still flipping burgers under the golden arches.

The best part is, by investing, you will be living off of free money. It’s not completely free, but the more you save when you are young, the more compounded interest you gain.

Simply put, your money grows, and you do nothing – similar to how Paris Hilton operates.

I know it is a big step to not just think about saving for retirement when you might not even have a steady job, but actually to do it.

However, finding the money to back up your investments isn’t as tricky as you might think, and it isn’t as daunting as it may seem.

My generation has grown up during the technology boom, and has been led to believe Ipods are about as necessary as oxygen to our existence.

We just have to exercise a little self-control if we don’t want to be forced to eat college-style noodles in a box when we are 65 (talk about coming full-circle).

So, even though it may seem that we can’t live without that modular hydration pen with global positioning capability and livelink system with a really cool rubber grip, step back for a second.

The $100 you are about to drop on the glorified writing utensil that will be obsolete nine seconds after you walk out of the store, could fund that trip to Europe you’ve always wanted, if you invest it now.

If you don’t trust yourself to set aside money, or didn’t know a CD is more than just a round disc that plays music, there is help.

Automatic withdrawal from your paycheck is a great way to save money before ever having a chance to get your hot little hands on it.

I suggest setting up a budget account of expenses – yes you are old enough to have one. Even if you don’t keep one, it’s a good idea to just track your expenses for a month and see what is eating up all that green stuff.

Finally, stocks, bonds, 529 accounts, IRAs, and 403b plans all sound scary.

It’s not that bad. There are helpful resources to help you pick and choose – and you don’t need to know everything about all of them, because chances are you only need to work with a few of them.

The simplest thing is to start saving money now with the goal of opening a Roth IRA (which is an account in which your money won’t get taxed when you take it out), or similar account.

Once you start saving you are already ahead.

Although I’d love to come over and watch the Super Bowl on your new LCD TV, I’d rather like to see you playing with your grandchildren at your Florida beach house than pushing a shopping cart down Main Street in 40 years.

Wouldn’t you?

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