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Saving doesn’t have to be scary

When can I retire?

April 24, 2023

Happy Monday, friends! I woke up singing the Baby Bottle Pop jingle?? Two things: 1) would love to know what I was dreaming about and 2) now I’m down a rabbit hole of the best ’90s commercials. Which one defined the decade for you?

Today’s tunes: “Love, angel, music, baby. Hurry up and come and save me”…from freaking out about retirement planning. Channeling the energy of the “rich girl” who inspired a generation to start saving (and taught us how to spell banana), Gwen Stefani.

—Rod

How to Save Money So You Can Retire Comfortably

Katie from Money with Katie

April is the month 13 Going on 30 came out in 2004, but it’s also (and equally as important) Financial Literacy Month. For me and probably for you, that’s as good an excuse as any to talk about how to avoid working forever.

Today, WorkDaze goes to Wall Street. We’re covering how we can 1) save enough to retire someday and 2) make money talk less scary. And we’re doing it with Katie Gatti, the personal finance genius behind Money with Katie. Read this if you want to spend your sixties sipping bubbles on a beach instead of replying to a Slack poll about this Friday’s lunch and learn.

Without further ado, your step-by-step to saving.

Step 1: Admit we have a financial literacy problem in America

38% of American adults said their lack of financial literacy cost them at least $500 last year, according to a recent survey. The truth is? We spent too much time in school memorizing PEMDAS and not enough time learning money basics.

Step 2: Temper those expectations

The bad news about those stats? We know less about budgeting, saving, and debt management than Sammi knew about Ron the first night at BED.

The good news? We should chill out about that.

“Nobody comes out of the womb just getting money, but it's like learning a second language,” Katie said. “The kids raised in bilingual homes have an inherent leg up, just like kids who did receive financial guidance growing up. But you wouldn't beat yourself up for not knowing how to speak Italian if you'd never tried or been exposed to it, right? That wouldn't feel like a personal failure—so why should this?”

TBH: Our lack of financial literacy education has been magnified by the hit after hit of the millennial experience—the 2008 Great Financial Crisis, the Covid-19 pandemic, and whatever’s happening to The Markets™ right now.

“It's really easy to feel like it's not worth trying when it feels like everything you've been told your entire life about how to ‘succeed’ didn't play out as promised,” said Katie.

But as a wise woman once said…

Step 3: Just start (even though it’s the hardest part)

Katie said the first step to start your ~personal finance~ journey is getting the education you might’ve missed out on. You can try books, TikTok, or Katie’s stellar content. Then? Keep this playbook in mind:

1. Create a budget. A not so fun fact: the majority of people underestimate their spending by up to 30%. Which is why it’s a good idea to create a budget before setting your financial goals. Get specific on your spending habits and consider a free budgeting tool to keep track.

2. Establish your goal. “When you're trying to save money, it's crucial to understand what you're saving for—otherwise, each purchase decision is going to be get the thing vs. don't get the thing,” Katie said. And retiring someday is much bigger than deciding whether you can afford a DVD box set of all six Gossip Girl seasons.

Katie’s personal savings goal is financial independence, aka not having to work for money someday. “I have to balance it with having fun in the moment, of course, but it really sharpens my focus on what's important and what's not,” she said.

3. Do some light math. The more you save and invest, the earlier you can retire—regardless of your salary. Katie’s formula for determining how many more working years you have: If you save and invest 20% of your income, you can retire in about 40 years. Save and invest 30%? Less than 40 years. Save and invest 40%? About 20 years.

4. Work smarter not harder. If you, like me, only ever hear people talk about stocks when CNBC is playing in your dentist’s waiting room…consider a roboadvisor (aka a service that automatically invests your money for you).

At the end of the day? Money doesn’t have to be scary. Two things to remember if you never want to read “I hope this email finds you well” again: 1) Starting now is better than never and 2) small actions lead to big results.

Now, let’s get this 🍞…(I’ll see myself out.)

Things to Slack your work besties

…as you paint your nails off-camera during your weekly team meeting.

Without the encouragement from leadership to take days off, employees with unlimited PTO policies tend to take less time off than those with a set amount of paid time off. For the record, you don’t have to tell me twice. Take your vacation days, friends!

A life hack no one talks about: setting your phone alarm to play “Wake Up” by Hilary Duff. Burnout doesn’t stand a chance.

Radio Rental is a podcast narrated by Rainn Wilson that tells true (!!) scary stories set inside a fictional ’80s video rental store. A mind-blowing fave? The Dopplegänger story in episode two. If you have any theories after listening, I have to know!

That’s it for today! Let’s have a good week. See you back here on Friday! 🫶

IDK WHAT DO I KNOW?! LMAO!

—Rod

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