Who will end up with more money
for retirement?
Assuming that they both earn
8% consistently until they retire at age 65, Ann will
end up with $188,922. Although Adam contributed three
times as much money, he would end up with $146,815. This
amounts to $42,107 less than Ann!
The secret to this mystery is time. Ann
started her contributions much earlier and thus her
money was able to work longer. If Ann would have been
able to continue her $100 per month saving until age 65
she would have ended up with $335,737. Even though she
only put in $12,000 more compared to Adam, her account
is worth $188,922 more than his.
What can we learn from
this?
The sooner you start saving for your
retirement the better. Even if you are only able to save
a small amount, it is easier to increase your
contribution as time goes along than to play catch up in
saving for your retirement later.
Don’t be caught off
guard
SunAmerica Securities* can help you
plan your financial future by offering assistance with a
wide range of financial options. To contact a SunAmerica
representative, call (602) 683-1000 or
1-800-523-4603.
