Fantasy football has become a national obsession and has appealed
to adults of all ages. Magazines, television shows, and ESPN updates
have been dedicated solely for the purpose of fantasy football. I
personally have been among the ranks and joined in on the fun for a
couple of years. So, I bring this up not to say fantasy football or any
other entertainment activity cannot be fun or important, but do we
spend more time planning for these activities and neglect planning for
our future? From a financial planning standpoint, we sometimes find
individuals late in their working years that have very little set aside
for retirement. However, somehow it seems they have found the resources
necessary to purchase the latest flat-screen television or newest BMW.
These are all great in their proper place, but not at the expense of
sacrificing our future. So, I ask you, are your financial priorities
With personal savings rates so low and mortgage defaults rising, we
have to ask ourselves, are we too part of the problem? Are we living
within our means and putting enough aside for our future?
Social Security is considered by many to be a major source of
income during their retirement years. This has also been a major topic
in the latest presidential debates and one that will affect us all.
However, are you depending too much on social security for you future?
With so many from the baby boom generation nearing retirement, our
already strained system will be under even more pressure in a few
years. No one knows for sure, but it is a fairly safe assumption that
social security will not be enough to meet your retirement needs.
So I encourage you to take advantage of some of the retirement
opportunities available to you through your current employer. Many
employers offer some form of a 401k, Simple IRA, SEP, and/or profit
sharing plan. Many plans offer a company match, meaning they will match
a portion of the amount you contribute to the plan. This is one of the
best ways to save for retirement. For example, if you were to
contribute $200 month, and the company matched 50% of your contribution,
you would have just added $100 to your investment and made a 50%
return! Then, the $300 would be invested in any number of investment
options offered as part of the plan. If you were to invest this
$300/month for 20 years averaging an 8% annual return, you could have
approximately $178,000! Additionally, if you factor in incremental
increases to your contributions as a result of periodic raises, your
potential savings could be much more. If your employer does not offer
some type of a savings plans, you can always look into a personal
retirement account. The limits to how much you can contribute are
continually increasing. The tax-saving advantages are also additional
positives to retirement savings. Consult an investment advisor or plan
administrator to learn more about these tax advantages.
Again, keep in mind, activities like fantasy football can be
wonderful fun, but let us take the time now to consider where we might
be in 20 or 30 years and start planning now. The biggest thing that
young people have on their side now is time. With so much time between
now and your retirement years, a little saved today can make a very
positive impact on the way you live later in life.
Aaron Archambo is a financial advisor and the vice president of
Archambo Financial Advisors, Inc. Securities Offered Through Dominion
Investor Services, Inc. Member FINRA