You know this already:
The smartest thing you can do for yourself financially is to start saving for your retirement as soon as you get your first job.
Starting to save early has a MASSIVE impact on how much you end up with.
Have you ever, asked Sam Beckbessinger, considered how much of a difference it could make if you gave your child a 20-year headstart by starting to save for her retirement from the day she’s born?
If, for example, you manage to scrape together R2750 a month from the day she’s born, and put it in a Tax Free Savings Account (TFSA) until she’s 16 (i.e. max out the TFSA allowance for them), then your kid will never have to save a cent for their own retirement and can live off R87 000 a month from age 65 (yes, taking inflation into account!).
Or they could retire at age 43 on a monthly income of R20 000 a month, even if she never saves a cent in her life.
Most new parents don't have an extra R2750 a month to save, and most people probably feel like kids should save for their own retirements.
But it's still a fascinating illustration of how powerful compound interest is.
Perhaps you have an extra R100 or R200 a month to save; is it worth it?
It is, said Beckbessinger.
What matters most is for how long you can leave that money alone.
For more detail listen to the interview in the audio below.
Get the 10 most-read articles of the week from Bruce Whitfield’s The Money Show, emailed to you every Friday morning:
Recommendedby NEWSROOM AI
Bruce Whitfield interviews Darryl Erasmus, Chief Quality Assurance Officer at the Tourism Grading Council of South Africa.
Bruce Whitfield interviews Colin Coleman (MD, Goldman Sachs Sub Saharan Africa) and Busisiwe Mavuso (COO, Business Leadership SA).
Data shows that almost everyone sucks at investing, says Warren Ingram. Here's how to avoid shooting yourself in the foot.
Should you keep them "forever"? Tax expert Chris Sloane on the requirement to keep tax records available for inspection by Sars.
Saving money on boring stuff such as a car can allow you to do really outrageous and courageous stuff, says Sam Beckbessinger.
Sam Beckbessinger on her book “Manage Your Money like a F*cking Grownup: The Best Money Advice You Never Got”.
Mayco member for corporate services Sharon Cottle explains the Traffic Fines Roadshow at the Cape Town Civic Centre this week.
An ambulance crew was held at gunpoint, assaulted and robbed of their belongings while on a call out in Khayelitsha.
MultiChoice will increase the prices of certain DStv packages from 1 April.
These are the emergency numbers you should have on your cellphone and this is what you must understand about how they work.