- David Fisher, a 69-year-old retiree living in New York, would tell his 35-year-old self to invest and save more for retirement.
- While he was passively saving through his employer’s 403(b) program, he didn’t start actively saving beyond his employer’s contribution until his 40s.
- He put in a lot of work once he took a more hands-on approach to retirement, working overtime to pay off his home at age 56, pouring extra cash into his 403(b), and building a separate cash nest egg.
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It’s never too early to start saving, and that’s the advice the 69-year-old retiree David Fisher would tell his 35-year-old self if he could turn back time.
The former college public-safety officer who retired at 65 said he didn’t think much about saving during his first 10 years working at a university. The college he worked for put about 6% of each employee’s gross pay into a retirement fund, regardless of whether the employee contributed. “From 33 to 43, those quarterly statements I got from TIAA, I threw them away,” he told Business Insider.
But one day, he saw just how quickly that added up. “When I was in my early 40s, maybe 43, I opened one of my quarterly statements,” Fisher said. “And I said, ‘Oh my goodness, I got $30,000 in here. That’s my money.'”
It was a large enough number to catch his interest. “Then I became interested in retirement and what Social Security was going to look like, how much money I had, and what I owned,” he said. He became more actively interested in saving for his future in his 40s, and he also started investing and saving additional money for retirement.
Since taking a more hands-on approach, he started pouring additional contributions into his 403(b) on top of the 6.2% the college contributed to have an income separate from Social Security. He also started putting extra funds into a separate cash nest egg. Fisher also refinanced his home from a 30-year mortgage to a 15-year mortgage, and he then worked overtime to pay off his home and make upgrades to increase its value before retiring at 65. Finally, he opened a supplemental retirement annuity, which he says now grows each year, even while he’s retired.
Even though he now has a comfortable life in the Finger Lakes region of New York, looking back, he said he’d tell himself to start sooner. “Invest as early as you can and put away whatever you can afford,” he told Business Insider. In his case, it would have made saving for retirement easier.
And there’s a big incentive for anyone to start saving earlier: The earlier you start saving, the more you end up with.
A scenario from Beth Kobliner’s book “Get a Financial Life” illustrates this perfectly. Kobliner sets up two different retirement scenarios, with each person saving $1,000 a year in a retirement account with a 7% return. One person starts saving at 25, the other at 35. Even though one started just 10 years sooner, that person end up with over double the savings at age 65 compared with the person who waited. That’s thanks to compound interest, in which interest earned on investments essentially earns interest on itself.
As Business Insider’s Tanza Loudenback reports, many people don’t take this advice to heart. Data released by the Federal Reserve shows that 42% of 18- to 29-year-olds and 26% of 30- to 44-year-olds have yet to start saving for retirement.
“I got a late start,” says Fisher, looking back at his saving process. He added that he was glad he had a job that encouraged retirement savings, even while he wasn’t taking much of an active role, but he says he didn’t hear enough about saving for retirement when he was young. Fisher feels fortunate to have started saving when he did, even if now seems late. “I’m not wealthy,” he says, “but I am comfortable.”
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