It’s never too late to build up your nest egg and put yourself in a better position by the time you retire. A 38-year-old recently turned to Reddit for some advice about getting back on track with their finances.
The Redditor earns $100,000 per year, pays $1,500 per month in rent, and has a fully paid car that has some wear and tear. The individual has $45,500 in a 403(b), $13,300 in a Roth IRA, and $3,500 in a high-yield savings account. The 38-year-old also has a $14,000 personal loan.
Several Redditors jumped in the comments and offered their suggestions.
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Be Patient
Many commenters said that the original poster is in a good spot. The 38-year-old is single, has a six-figure salary, and maxes out their 403(b) plan. While the Redditor doesn’t have enough money to retire, that may not be the case in 20 to 30 years.
The portfolio will compound over time, but that only happens if the Redditor regularly invests. Everyone wants financial success now, but it takes many years to reach six figures and contribute enough money to have a seven-figure portfolio.
The Redditor acknowledged struggling with alcohol over the past 10 years and recently became sober. As long as the Redditor remains sober and continues their current financial habits, retirement should be feasible by the time the individual reaches retirement age.
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Keep Your Spending In Check
One commenter encouraged the 38-year-old to keep their spending in check. It’s tempting to spend more money as your income goes up, but people who live below their means give themselves a distinct advantage in their retirement years.
“Keep your current savings rate and keep your budget and spending in check, and you will be fine,” the commenter said. “Give yourself some grace and enjoy life as well. Pay off that personal loan, and don’t get into a situation where you need to take on debt.”
Debt can cripple any retirement strategy. If you get too deep into credit card debt, it’s hard to make any progress with the principal. The $14,000 personal loan isn’t good, and it’s something the 38-year-old has acknowledged. Staying out of debt will reduce the amount of turbulence on the path to retirement.
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Don’t Worry About How Others Are Doing
Feeling like you are behind can make your current progress feel smaller than it really is. If you compare yourself with others too often, it can lead to people not feeling good about themselves, and one commenter made this point nicely.
“Comparison truly is the thief of joy,” the commenter said.
Having good financial discipline and regularly investing will get you ahead of most people. However, you don’t have to focus exclusively on the people who are ahead of you. It’s also good to compete against yourself and see how much you have grown. Then, you can look for ways to optimize your finances so you can save and invest more money.
Focusing on what you can control instead of comparing yourself against others can preserve your joy while moving you closer to your goals.
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