The saving for retirement mindset goes back many years and has been steeped in society to this day. The problem is that this way of thinking no longer works, and I'll explain why.
Probably your parents, since you were little, have been telling you to save a part of what you have earned or that you have to save for a rainy day. Sure... but have you ever thought that you only spend money when you have free time? So your parents should have told you to save to go on vacation, right?
It's not our fault, no one has taught us, since childhood some way to make money, and that's why a lot of people only have some money when they can no longer enjoy it. There are also those who can not even spare and the numbers indicate the reality:
The average retirement savings of US households is about $95 000;
The average savings for all families living in the US is about $5 000;
The average savings of all households that also have retirement savings is
Well, $95 000 seems like a lot, right? Not really, imagine a person who retires at 65 with this savings amount, divide it by 240 months, which will be, for example, the months to the end of life at the age of 85, and we get a value of about $395 per month.
About 65 % of the population in the US relies on social security for retirement.
Who can live, decently at $395 a month, if they spend part of this amount on a trip to the supermarket?
The myth that the sooner we start saving, the better it's a fairy tale ... saving to invest?
How does a 12-year-old or 20-year-old know where and how to invest?
It is best to teach these individuals how to make money because I just do not know anyone from my generation who has been taught how to make money.
These are the reasons why society finds itself in the situation it is in because the mentality of the middle class is so present in our heads that neither can we realize that the solution to a successful life is not to save but to invest in a polite and conscientious way.
The problem with the savings mindset is that there is a lack of control of the money on the part of the holder considering that if I put my money into a retirement savings account and I can not use it in the next 30 years, where is the control here? The only entity to control it is the bank, not me.
Do not stick to savings of $3000, for example, adopt another mindset and make sure that $3000 multiplies as many times as you want. Act like if you are always broke, even if you have $1 000 000 in the bank because money needs to circulate not to pick up dust.
If you think saving for retirement is a bad idea and you want to invest in your education and start getting another source of income check this out.
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Have a great day!