First Things First

You may not realize it, but the choices you make today will have a major impact on your tomorrow. Whether you are graduating from college, or just entering the work force, we can help you manage your finances so you get off on the right foot.

Most Americans who obtain an advanced degree enter the workforce with a significant amount of loan debt. A 2012 study by the research firm TransUnion showed that the average college student graduated with $23,829 in debt – up 30% since 2007. Government statistics show that nearly two-thirds of college grads have at least some debt. In that situation, the temptation might be to put off investing or postpone saving for retirement until the debt is paid off. Unless your financial advisor recommends otherwise, you might want to invest at least a little today because in general, the earlier a person starts investing, the better chance those investments have to grow before they are needed.

Take a look at the chart below. In the first column, a person has invested $2,000 a year every year for 10 years, then stops for the next 20 years. Assuming an average annual return of 8%, $20,000 invested in this way will grow to almost $146,000 after 30 years before deducting for taxes and investment fees.

On the other hand, if this same person waited 10 years to start investing, and then invested $2,000 a year every year for the next 20 years, that $40,000 investment total would grow to only $98,845 by the end of 30 years.

Assets May Grow Faster if You Start Investing Early

What Can I Do Today?

Here are three, practical steps that can be taken today to prepare for tomorrow:

  • Track your spending - Listing expenses on paper is a great way to determine what your needs might be in retirement or to determine an appropriate goal to set. We have material to get you started.
  • Put money into an IRA - Traditional IRAs and Roth IRAs each offer different advantages. Decide which one is right for you, open an account, or fund an existing account.
  • Get advice - A trusted financial professional can help you ask the right questions and create the best plan for you. Call 800-MAINSTAY (624-6782) for more information.