Trade In Your Cell Phone and Latte for Financial Security

With traditional pensions vanishing, social security at risk and health costs rising, Americans are faced with the daunting task of providing for their own retirement. It will take million-dollar nest eggs to provide secure streams of income for lengthy retirements. And to accumulate this amount of money, you need to start saving at the youngest age possible.

Mass merchandising of our consumer-driven society has convinced many of us to spend all of our money on oversized homes, oversized furniture, upscale appliances, huge vehicles, expensive clothes and shoes, large-screen televisions, ride on mowers and all sorts of gadgets. But all of this spending comes at a cost because each dollar that you spend today is not available to invest. So that recurring sixty dollars per month cell phone charge could have been invested at six percent for 30 years to give you $60,271 towards your retirement nest egg. Or the fifty dollars spent each month for the morning latte could have contributed $50,226.

Deferred gratification is not part of the American psyche because we want our creature comforts now and we want a lot of them. But to ensure a secure financial future, we must begin to defer some of our spending so we can begin to save and invest now.

Posted May 2006.