Discussions of Mormons and Mormon life, Book of Mormon issues and evidences, and other Latter-day Saint (LDS) topics.

Wednesday, December 21, 2005

Hope for the Future: Young People Who Save

Recently I spent some time talking with a 19-year-old who is preparing for a mission. I was surprised to learn that he is not only saving for his mission, but is also interested in saving for retirement. He's got a full-time job with a savings plan, and he's already for some funds in an IRA. He asked some questions about mutual funds, stocks, and precious metals. In an age when so many Americans are on a quest to get every further into debt, in an age when people tend to spend all they have and rarely make reasonable decisions for their future, it was so refreshing to talk with a young person who is not only saving for a mission, but is also seeking to save for the distant future. More of us need to do the same.

Don't think you're prepared for the future just because you have a good food storage. The counsel from Church leaders has been to not only store food for emergencies, but also to live frugally and save wisely as well.

I've enjoyed learning about the stock market and making my own decisions about where to invest. But the reality is that how one invests is usually not nearly as important as how much one invests. Quantity, not quality, is the first thing to consider. Investing 10% or more of your income in a lackluster mutual fund is usually more likely to give you a significant nest egg than putting just 5% of your income into more successful securities. Rather than spending tons of time figuring out how to get a few extra percent from your investments, it's probably smarter to work harder and spend less so that you save a lot more. (But once you are saving aggressively, why not do some extra research to get more out of your money? Understanding the roles of stocks, bonds, precious metals, etc. can make a huge difference in what you achieve.)

If you're in a situation where you can save money, you should be. How can we adequately provide for our families and seek to be self-sufficient if we don't save for the future? And if you are saving now, I suggest it's time to ramp it up. And teach your kids to do the same.

There are young people out there thinking intelligently about the future and I've met several recently. That's encouraging!

3 comments:

Ritsumei said...

You might enjoy the book Rich Dad Poor Dad. I know that I sure did. And it changed the way that I think about money. Now, if we can just get rid of the debts so that we can get the principle of intrest working for rather than against us.

John Mansfield said...

A 19-year-old aggressively saving is great. A 19-year-old planning his retirement is a bit depressing.

ed said...

Good for him...but I hope you told him to stay away from the precious metals.