What should you know?
When planning for retirement, there are only two types of people: those who will run out of money in old age, and those who won’t. Everyone wants to be in the latter group, but many do not do much about it, until it’s too late.
The time to create sufficient wealth to be truly financially independent is during the savings stage of life (whilst you’re earning an income). This is your “wealth window”.
As you progress through life your wealth window is always closing, one paycheck, one month at a time.
The graphic below shows the case of a 45 year old aiming to retire at age 60. They have 180 months left in their wealth window to secure a comfortable future:
Why should you care?
Whatever age you are now, you have a finite number of paychecks that remain to accumulate the wealth you will need to sustain your desired lifestyle in the future.
Investing your money today creates the spending power for your future self. Getting this right means you can live the life you want with dignity and confidence.
If you plan ahead and start early, you have more than enough time to build the wealth you need. But, if you leave things too late, the only lever left will be the one marked “keep on working”.
