A lot of things happen when you turn 25.

You’re usually starting out in a career post-varsity, a quarter-life crisis will probably make you reevaluate every life decision you’ve ever made, and your hangovers get worse.

A lot worse. I don’t know why. They just do, and sadly they don’t get better from then on out.

The other thing you should be doing at 25 is starting to save for retirement.

According to BusinessTech, 53% of South Africans have no formal retirement savings at all, with 38% planning to rely on their children to take care of them in old age, and 32% expecting the state to do so.

None of these count as a reliable or viable retirement plan. “Time in the market” on the other hand could see you with solid savings to get you through your golden years.

Here’s an example:

…if you start saving at age 25, you can accumulate investment growth of R915,000 by age 65 by simply investing R178.74 per month, assuming a compound interest rate of 10% per annum.

However, if you only start saving at age 45 and you invest R1,381.24 per month, you will achieve investment growth of only R668,502 by the time you retire.

Just think about those numbers for a second, and the penny really drops.

R178,74 per month is probably less than the average 25-year-old spends on airtime, so it’s not out of the question.

Hell, that’s three craft bars with a tip at your local, so a really simple life choice here and there and you could wangle that money from somewhere.

The next step is to avoid drawing on that cash when things get financially tough.

With living expenses ever-increasing in South Africa, people should avoid the temptation of cashing in their retirement funds when changing jobs or when facing financial difficulties.

Doing this could have long-term consequences and negatively impact their ability to retire comfortably with enough capital.

Of course, the admin of saving and the temptation to spend it can all be avoided if you hand the management of your personal wealth over to an expert.

Consequence Private Wealth believes that “the consequences of decisions made today will unfold over a lifetime based on the sound principles applied at their inception”.

In other words, they want to help you invest in your and your family’s future now so that you can enjoy the best possible financial outcome when you retire.

Because while it feels like old age is centuries away when you’re 25, that killer hangover is a reminder that you aren’t getting any younger.

[source:businesstech]