Hello alphabet soup
I like to plan out my life and think about the future. This is not a secret. But I've never actually thought about the day that I'll be 60 or when I'm going to be retiring and needing money to support myself. I've always been like RRSP-what?? I've never thought that I really needed to worry about all that kind of stuff because I'm young and I'll worry about it when I'm older.However, living solely on my own now and paying increased rent along with more bills has made me realise I really need to budget. It's also made me more money-conscious and I'm starting to think about saving for the long term. Which is why tonight I attended a financial education workshop for women. Tonight is the first of 3 classes (which are free) wherein I'm learning about RRSPs, GICs, mutual funds, stocks, bonds, the new Tax Free Savings Account, along with a million other things. And at the end of it all, I'm going to be investing and building an RRSP and likely more.
AND, because I never realised how important this all was, I want to pass on the message to everyone to gain knowledge and then INVEST. It's so important!! I have to pass on the cases of Early Elaine and Late Larry, which were outlined tonight because I think this makes it so clear. Early Elaine invested $4000/year into her RRSP, starting at the age of 25. (And come on, $4000 a year? That's about $300/month, which is peanuts. Here is the motto of the evening: pay yourself first.) Okay, so this Early Elaine chick puts away $4000/year for 12 years until she's 36. Then she doesn't contribute another penny. By the time she's 71, she will have made over A MILLION DOLLARS after only contributing a total of $48,000.
On the other hand - if you suck and wait until you're 37 to do something about your future, like Late Larry who invests $4000/year starting when he's 37 - if he keeps investing that same $4000 every year until he's 71, he'll have only made around $700,000. Not even close! AND, he had to contribute a total of $140,000.
MY POINT IS: start contributing to an RRSP early! The younger you are, the better. Wow that turned into a giant rant and I hope I sound like I marginally know what I'm talking about.
INVEST!
Labels: money
posted by Maresa @ 12:49 AM
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