The thought of retirement can be daunting. Bills are high, budgets are tight, and it is sometimes difficult to stash away enough cash to make a noticeable difference in your savings accounts. Your age does not matter–whether you’re living in an independent senior living facility or a college campus, you should start saving immediately.

Life is short. Waiting to save will only make it harder for you down the line, and who knows what your job prospects will look like then? That is not to sound dire, but the truth is that nothing–not even social security–is promised.

We have to fend for ourselves in this world. One of the best ways to ensure you’ll live comfortably in your later years is to start saving for retirement now. Let’s look at some ways you can do that.

When should you start saving?

Ideally, you should start saving now. While this might be a bit difficult in your formative years, you should certainly begin saving once you graduate and set off into the workplace. The best books about saving money suggest starting saving from your very first paycheque.

Why?

The sooner you begin saving, the more time your money has to compound interest, and that’s the name of the game. Let’s say you begin saving at age 21, investing £1,000 a year in the best retirement-ready portfolio for 10 years. Even if you don’t place one more cent in your retirement account, by the time you reach 65, it could have grown to more than £112,000! That’s the power of compound growth investing. 

Therefore if you want to know how to retire early, the answer is always to begin picking out the best investments now!

Best ways to save

There are a variety of ways to save money for your retirement. The most important thing to do when trying out money-saving strategies is to find the one that agrees with your lifestyle. There is no one-size-fits-all approach to how to save money, so try a few of the following options and see what works for you.

• Save your change. If you don’t carry cash, this technique works with apps like Chime and Acorns. Simply tell the app you want to round up your purchases to the next dollar amount, and it will automatically deposit the difference into your savings account. In our Hargreaves Lansdown review and interactive investor review, we explained that these investing apps offer low commissions for regular trades made each month. This can make it cost effective to buy shares with your loose change.

• Stash unexpected cash. Birthdays, Christmas, work bonuses–these unexpected cash prizes are likely not calculated into your monthly budget and are perfect for dumping directly into your retirement account. Don’t bother stuffing any into your pockets, and stash it immediately.  

• Crush a habit. Your smoking and soda-chugging habits are not only killing your body; they are ravaging your wallet, too. Try quitting a bad habit this month. To add motivation, count the amount you saved and think about that the next time you reach for a pack of smokes.

• Audit yourself. If you’re having trouble finding something to cut back on, or if you’re living paycheck-to-paycheck and can’t seem to keep money around long enough to save it, it’s time for an audit. Mint is an excellent app for visualizing your spending habits and will help you decide if Apple TV, Netflix, and Hulu are necessary expenditures.  

4 Crucial Steps to Take For Retirement Saving

1.      Know When to Start Planning

Many young folks today do not seem interested in saving money for retirement. That’s a shame, considering the fact that social security will not be around when they retire. That’s why it is so important to begin planning your retirement now. Not tomorrow. Not next week. NOW.

Even if you are invested in a 401k with employer-matched contributions, it is never a bad idea to stash a little money from each paycheck into your retirement savings account. The more you save now, the less of a chance you’ll struggle later on in life. 

2.     Determining the Amount to Save

Most financial advisors and planners will tell you to stash away 10% to 15% of your income starting in your 20s. If you start saving later in life, it would behoove you to bump that number up to 15% to 20%. That said, it’s difficult to throw a percentage at someone without first providing some contextual evidence as to why they should.

A great way to find out how much you should be saving is using a tool like the Money & Pensions service Retirement Calculator. Input your age and current savings, and the tool will calculate how much you should be saving to live comfortably in your twilight.

Remember, if you want to retire earlier than you’ll need to save a higher amount each month. For example, if you want to retire at 50, you may need to save twice as much as someone aiming to retire at 68.

3.     Prioritizing Your Goals

There are four main areas of analysis you want to consider when setting retirement goals. Thinking about the following four items will allow you to prioritize the next actions for bolstering your savings account:

• Lifestyle: What would you like to do when you retire, and how much will it cost each year to maintain this lifestyle?
• Timeline: When do you want to retire?
• Strategy: What type of savings plan best fits your lifestyle choices?
• Action: How much money will you need, and how long will it take you to get there?

4.    Evaluating Retirement Plans

Individual Retirement Accounts (IRAs) and 401(k)s are your best bet for saving retirement funds. These savings accounts are “tax-deferred,” meaning they’ll avoid the standard income tax deductions until you decide to withdraw the money. As a result, more of your money will accrue interest compared to other savings accounts that deduct taxes.

When making retirement plans, the best retirement books suggest paying close attention to the fine details such as interest rate and matching contributions. As long as you stick with IRAs and 401(k)s, though, you’ll be in good shape when it’s time to hang up the work boots.

Additional Things to Know

• Most financial advisors suggest you’ll want 80 to 100 percent of pre-retirement income for your retirement years. While this depends more on your lifestyle, it’s a good number to shoot for if you’re undecided on retirement activities.
• Habit trackers like the one in Tick Tick are great for reminding you to save while you’re out and about.
• Learning how to invest can be a long journey, don’t expect to be able to learn everything in a day.
• You can try using a financial planner or advisor, but just be cautious of their fees. Your job is to save for retirement, not spend more money than needed.

About the Author

Roni Davis is a writer, blogger, and legal assistant operating out of the greater Philadelphia area.