BUSINESS COLUMN
Can You Afford to Retire?
by Arthur N. Framke
Will the baby boomers go bust? The statistics are telling a sad
tale. According to a recent survey, the majority of 30-49 year
olds do not earn enough money to save for retirement. And relying
on Social Security is becoming a riskier bet with each passing
year.
The doom and gloom boys predict that the Social Security system
will be insolvent in 20 to 30 years. Don't be anxious about this.
Read the scriptures. Matthew 6:25-34 says "We are not to
be anxious about tomorrow." Good sense tells us to plan and
be diligent.
So consider this your wake-up call. Get ready now for your retirement.
Saving for retirement means accumulating buying power rather than
accumulating dollars. It's important to allow for inflation, a
lurking demon that while under control for the last few years,
is always around the corner.
Think about this. A dollar buried in the backyard today will have
the buying power of only 56 cents in 10 years. Pretty frightening,
but don't despair. If you embark on a plan now you can get started
down the road to a comfortable retirement.
The most important point to remember is get started now! There
is a high cost to procrastination when it comes to tax deferred
plans. Because of the power of compounding, the tax deferred income
earned by the investments in plans grows quickly. For example,
if you contribute $2,000 per year for 20 years to an IRA or other
type of retirement plan, and assume an 11% return at the end of
the period, you will have $142,000 in your account. That's a lot
of retirement to look forward to!