5. The Economy Is Bad.
“Saving for retirement is for the long term, and a down economy is just a part of the business cycle,â€ says Benna. Even during market fluctuations it is important not to suspend your contributions; instead make sure your assets are diversified to protect you against market fluctuations. “The fact that the economy is bad now should not prevent you from contributing to your retirement, provided you have at least a seven-year period before you need the money,â€ says Harris. “The goal is to buy low and sell high.â€
6. Retirement Is Decades Away, I Can Wait.
“Time is the most critical element,â€ says Harris. “Regardless of how much money you have, it is so important to start as soon as possible with any amount you can. Time is more important than how much you put away, because time has much more of an impact.â€ Benna agrees. “The sooner you start the greater the amount that will come from investment income. The longer you wait, the more you will have to contribute from your pay later to reach your goal.â€
7. Social Security Will Provide.
Social Security was never designed to be the sole source of retirement funds. It was designed to supplement. Right now the average benefit is $1,153 a month, which is less than $14,000 a year, explains Harris. “That’s right above the poverty line. Is that enough to maintain your lifestyle?â€
For more, read “Too Young to Think About Retirement? Think Again!” in the October 2011 issue of BLACK ENTERPRISE.