BY DR. GLENN MOLLETTE
Delay is not always the best plan but you cannot do everything today.
You can delay paying your utility bills for a few days, but you cannot delay for very long or the utility company will turn off your power or water.
You can delay mowing your grass for a few days but eventually the grass will become unmanageable if you wait too long.
Certainly, you can postpone your doctor’s appointment for a while. However, if you wait too long your minor problems may become major problems.
Some things in life have to be done today while some can wait a few days. We cannot do everything today. Often, there are expenditures we would like to make but cannot afford at the moment. So, we have to save our money and wait until we have it. Too often, people cannot wait and buy now to pay later. There may be some purchases like this we can justify, such as a house or a car. We need a place to live and transportation to work. How much you can afford to spend on monthly payments for housing and transportation depends on your income. Try not to overdo it because even reasonable amounts of money are not fun to pay back, especially with interest attached.
Delay depends on how much time we have. A 21-year-old feels like life is forever, while a 70-year-old knows time is fleeting. If you are graduating from high school, all of life is before you. If you are past 65, then you better move a little faster doing what you want or need to do.
Of course, nothing is for certain. A young adult has no guarantees and some old people just keep getting older. We never know for sure but we do know our chances diminish greatly with age. The body wears out.
Eighteen-year-olds should try really hard to earn some money and put $2,000 or $3,000 a year into a Roth IRA account. Say you are 18 and can rake up $3,000 in 12 months. If you invest in a Roth IRA and never touch it until you are 68, you will have about $184,000. For the last 50 years, the stock market has averaged about 10 percent annual growth. If you invested $3,000 a year at ages 18 and 19, you would have about $632,000. Do you know how many Americans have this much money? Only 3.5% of Americans, or around 12 million people, have $500,000 or more in retirement savings. Only around 1% have $600,000 or more.
Granted, $600,000 will not buy nearly as much in 50 years but it will buy something. The point is that delaying investment in a Roth IRA or any 401(k) is very, very costly. Many 18-year-olds do the exact opposite. They go out and go head over heels in debt. They borrow hundreds of thousands of dollars to obtain an English or psychology degree from a pricey college that they never use. Saving money becomes a bone-crushing impossibility for years and years. Sometimes many are never able to save any. The end result: old age is not good.
A 65-year-old couple once said, “We’ve got to figure out a retirement.” Sadly, they had never saved a penny. Today they are both on Medicaid, living in a nursing home.
Mow yards, dig ditches, work at a department store or whatever it takes. Spend some time early in your life saving a few dollars. The end result will be amazing but delay does not pay.
Dr. Glenn Mollette is the author of 15 books. He is a graduate of Southern Baptist Theological Seminary in Louisville and Lexington Theological Seminary in Lexington. He is the founder of Newburgh Theological Seminary, Newburgh, Indiana. His column is published in over 600 media outlets nationally.