I am glad to announce that today I have a special guest post from Blake of Millionaire Mob from millionairemob.com. First, a short bio. Millionaire Mob seeks to help you ‘Escalate Your Life’ through providing personal finance advice and passive income techniques that will help you achieve financial freedom. You can check out Millionaire Mob at his website above or on Twitter @millionairemob2.

The views and opinions expressed in this guest post are those of the guest author and do not necessarily reflect the opinions or views of Defeating Normal.

Getting Over the Hump

Savings has always been my focus. Hence, why I started Millionaire Mob to help others with their savings and personal finance. At the same time, I am that kind of guy who loves to spend – on myself, my wife, my kids. I love to live life lavishly. And my wife has always nagged at me for our rising expenses and low savings.

‘What about after we’re retired?’ she would say. ‘How are we going to survive if you never save up for our old age?’

Well, one day I had news for her. I had amassed over $25,000 in retirement funds for the both of us. Saving for retirement is a tricky deal. Whether you live life comfortably, or from pay check to pay check, the surplus left over at the end of each month is often not enough to collect a decent amount for retirement.

Retirement savings need a careful plotting for the future. You need to dedicate time to making sure that your savings are actually transferred to your retirement fund. It needs effort and a consistent setting aside of your monthly payments.

By incorporating some lifestyle changes, a constant eye, and a careful follow-up on your savings, getting to the $25,000 mark is not that difficult.

SSP Transfer

The SSP is a fixed amount of your pay that is put aside by your employer for your retirement. This is deducted from your pay before it is handed to you, and is usually a fixed percentage of your total pay. The amount is matched by your employer, so if you have $500 deducted from your salary each month, the employer adds another $500 to your retirement benefit, which is handed over to you when you leave the company.

A smart thing to do is not to withdraw that SSP. Instead, get it transferred to your new workplace. That way, not only do you keep your corpus safe, it also serves to build upon your existing SSP, making the interest you earn on your savings higher.

Get a SIP

A SIP is a fixed amount of money that is invested in a mutual fund each month by your bank. It’s called a Systematic Investment Plan, which ensures that you have a recurring amount getting deposited into your mutual fund account each month.

Even if you are wary of investing too much money, this is a fail-safe plan for making sure that you do save each month. Even if you forget to transfer money into your savings account, your bank won’t! Look up a safe mutual fund, even if it has low pay-outs and get saving! After all, the objective is to save your money, not generate new out of old.

Convert a raise into your savings

Always keep a fixed percentage of your pay to be converted into savings, be it 30% or 15%. This means that rather than saving a fixed amount, say $2000 each month, you save a percentage of your overall earnings. That way, rather than saving only a fixed amount, you will save more with a higher pay.

You probably wouldn’t even notice that small amount going out of your pay, but it will make a huge difference when it comes to your retirement savings!

Don’t touch your kid’s college fund!

Whenever I was low, or when the expenses had gone too high, I would be tempted to delve into the college fund set aside for our son’s future. But that would have turned into a habit, which would have meant breaking open the retirement fund at the time of his tuition fee payment.

Don’t touch anything you’ve set aside for the kid. That gives them the security that they are important, and helps them understand how important it is to save too.

Take a loan

This may sound like the craziest idea ever, but whenever you need a huge amount of money, don’t touch your savings. My wife always threw her hands up that I would take a loan, but building up that amount all over from scratch will be tough. Instead, get a loan. When you get a loan, you have that pinch that you have to pay it back, which you wouldn’t if you had taken it out of your savings.

It may sound safer to take money out of your savings, but in the long run, it will harm your retirement funds more than if you take a loan.

Invest, Invest, Invest!

Don’t be scared of the investment arena! In times when you want to make money, the investment field is your friend. Of course, make sure you don’t blindly put your savings in places you know nothing about, or you’ll lose it all.

Study the investment market, look up stocks and talk to people who know about this stuff. The more you read about it, the more you’ll learn, and the better you’ll be at trading stocks. Since 1931, dividends from stocks have made up over 40% of large capitalization stocks’ return.

Get stocks which pay dividends on an annual basis, and you’re set for life! And if you invest well and the value of your stocks rises, you will have created a very comfortable nest egg for yourself.

Save Up For Your Retirement, It’s Not That Hard

The word retirement strikes terror in most hearts. And when you sit down to estimate how much money you’re going to need about twenty or thirty years down the line, it is a scary figure indeed. But retirement does not have to mean going downhill.

You don’t have to rely only on your retirement funds after you’re sixty. Nowadays, there are so many other methods of earning income for even after your retirement age. You don’t have to sit at home worrying about your money problems. You can get out and get busy!

But it is equally important to make sure that you have set up a comfortable retirement fund for yourself. If nothing else, it will give you that peace of mind which you need in your old age. Following the easy steps above is not that hard. It doesn’t require any major lifestyle changes or drastic measures.

It just requires time, effort and an urge to save. And that is the least we can have for our futures. What will you do next? What date do you anticipate to retire?

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