This series was inspired by the recent marriage in the family. I organized some information with my brother in law and new sister in law in mind, though the information can apply to others looking at their finances. If you find these tips to be useful, please share them.

Seeing how finances can have an impact on marriage, here are tips and stories to help you avoid common financial pitfalls of married couples.

Retirement planning can seem like a far away goal for some, but it can be one of the smartest moves you make. How you two sat down and discussed some of your financial goals, like when how you’d like to retire?

Remember your marriage is more important than money.

Invest While You’re Young

Investing young for retirement brings compound interest on your side. Compound interest speeds up your savings without you doing anything, but automatic deposits in sensible investments. here’s a snippet from previous post on how compound interest works:

The concept starts with the principle that you have some money ($1,000) which is earning interest (10%) each year. So the first year, you earn $100 in interest. However, the next year, you do not earn another $100—you earn $110.

This is because your 10% interest is applied to both your initial principle and the interest you received. Thus, as time continues, your interest each year grows larger and larger because it is compounding on top of itself.

Have Your 401(k)s Working For You

Looking at the chart below, you can see if you are consistent with your contributions, you can have compound interest help you increase your retirement fund even more.

Early starts with retirement contributions lead to big finishes aka. more money.

What’s more amazing is some employers offer a match for a percentage of money you put in. That’s free money you’re throwing away if you’re not contributing.

Check with your human resource department to see if you company offers a match and how much is it. an added bonus with 401ks is that the money is taken pre-tax, which can reduce your taxable income.

Open and Fund an IRA

Where can you open an IRA?

Many banks, brokerages, and credit unions offer both traditional and Roth IRAs. Compare your options to keep your fees as low as possible and get the best performance.

Some online options for opening an IRA (Traditional or Roth):

• E-Trade (Annual fee and minimum are waived when you sign up for electronic statements)
• Vanguard (Some funds require $3,000 minimum)
• T. Rowe Price
• Charles Schwab ($1,000 minimum is waived if you direct deposit $100/month)
• Sharebuilder (No minimum to open; no admin annual fee)
• Zecco( No minimum to open; $30 annual fee)

Each time you invest, you’re buying a bit at a time. Many choose to automate their investments at a fixed rate. The same amount is spent but the amount of shares you buy changes. I like index funds and when the price is low, I can get more shares for the same price I’ve been putting in.

While 40 years is a long time, the best time to start saving and investing is now in order to let compound interest work for you. Over time, you can make compound interest work for you.

Photo Credit: catlovers

Be Sociable, Share!

• 

• Carnival of Personal Finance #211: Burn Notice Edition Welcome to the 211th Carnival of Personal Finance! this week's theme is based on a new favorite show I've been catching up on: Burn Notice.  If you're not familiar with the premise, the main character, Micheal Westen, has been let go as a spy is trying to figure out why.......
• How to Switch Your Checking Account to Save Money on Banking /caption] My friend asked me to help her move her checking and savings accounts to another bank and organize her finances. She had been unhappy with her bank for a while, but she kept putting it off. My friend was worried about the hassle, so she asked me to help compare......

• How to be a Money Strategist to Reach Your Financial Goals (Part 2) How to be a Money Strategist In Part 1 of this article, I explained that I was a "money strategist."  Then, using the financial goals agreed on by me and my wife, I discussed how money strategies and money tactics work together in a personal financial plan to achieve those goals.   I then proposed that anyone can......
• The Money Genie Grants 3 Wishes Last week, Adam of Your Money Relationship posted "Money Genie: I Grant You 3 Financial Do-Overs" in which he offers the three things he'd do differently if he could go back in time. Never signing up for credit cards, funding his Roth every year, and not taking on student debt......