I finally have figured out where this blog is going. It was a subconscious evolution but one that is now obvious to me. I felt sports were too limited and better covered. So while I dabble with what's on my mind occasionally, this site offers next to nothing in the way of sports. I enjoy covering various TV shows and occasionally movies as seen by Tuesday's post, but this is no "what's hot and happening" blog either. And while everyone loves stupid criminal coverage, it's a safe bet that Jay Leno maintains a safe lead over me in this avenue, too.
So what then has Wolfden V become? Perhaps if I began labeling each post with a blue, red, green, or purple tab it might jump out at you as it recently did to me. I love the USA Today. I read every day's newspaper and even in the event that I get backed up a few days, a stack forms waiting for me to catch up (much to my wife's dismay). Each section of the paper appeals to me, and over time has manifested in a variety of blog topics that does not much differ from what I consume from the USA Today.
With that in mind, there's plenty of purple (life) and red (sports) coverage here on a regular basis, including the previous few posts. I occasionally jump to blue (news) for items such as Don Imus, but due to a whack job out in Virgina there's nothing but morbid and awful news to cover. As such, I feel it's time to embrace the green (money) section - a part of the paper that I have only dabbled in.
I decided to drift over to CNN Money, which frequently offers quality retirement writings, and examine an article by Carolyn Bigda. The starting point comes in the form of a letter from a 38 year old man who has spent his entire fiscal life spending and not saving.
"My instinct is if I want something I'll just go and get it...Up until now my life's really been about recreation."
The man naively believes that he can fix 15+ years of bad spending habits in two years where he will fiscally mature at age 40. The author happily points out that he has failed miserably thus far, and while it's fixable, this "I can always fix it later, so screw right now" approach is going to sting after while.
Those early-adult years offer the richest potential for growth: Invest $10,000 at age 30, and by retirement it will grow to more than $100,000, assuming a 7 percent annual rate of return. Wait 10 years and you'll have only half as much.
So not only has the guy dug himself a hole with the $40,000 in credit card debt he's carrying into his 40s, he has wasted away the most valuable years to have savings snowball. The small steps involves a $350 to $400 a month commitment to pay off that 40k. Instead of paying a credit card company some double digit a month cut on the interest, wouldn't it be preferable if that chunk of change was going into a saving, IRA, or 401(k) plan where you would not only keep that original dough, but turn it into more money through investing and/or interest?
Bigda suggests, as many personal finance writers and experts do, that young people take their retirement savings out first. Especially if done through an employer, that money comes out of paychecks pretax, meaning it will go further as taxes are not taken out of that cut of the check, and the temptation to spend the money need never exist as it is already deducted from the paycheck. Taking the time to set up the account and coming to terms that you really can live without that extra few percent is the hard part. Reaping the benefits in retirement is the fun part.