The Boulevard to Financial Independence

By Mariette

It’s National Save for Retirement Week! Who knew? In an effort to promote the idea that saving for retirement is important for everyone, regardless of income, the Senate and the House have declared this National Save for Retirement Week. So in doing our bit to promote this idea I want to look at one of the biggest stumbling blocks that people have to planning their finances in general and saving for retirement in particular, feeling too intimidated or overwhelmed at the idea of learning something new.

My suspicion is that a lot of Americans, in addition to being more interested in instant gratification than long term planning, feel intimidated by financial planning, are perhaps even a little afraid of it, and certainly overwhelmed. So they are resistant to even thinking about it. They often don’t know where to start learning about different retirement plans and investment options and feel like they are too busy to make the time to wrap their heads around it, so they ignore it. This ostrich approach however won’t help, since later often doesn’t happen until it’s nearly too late.

I too found the subjects of saving and retirement planning intimidating, and had a lot of resistance to retirement planning, up until I started working with Boulevard R. It was then that I began researching personal finance and learning that it’s not so intimidating after all, nor does it take that much time to get up to speed on the basics, and it certainly isn’t worthy of resistance. I quickly found that, as with any new subject, once you have a basic foundation of knowledge, learning about it becomes much easier, even interesting (this from someone with an arts background.) Sure it’s a little confusing at first, you’re learning a whole new language and it takes time to understand. This is particularly true if, like me, you don’t have much of a background in economics. But if you study it in small bits trusting that eventually it will make sense and you don’t need to understand everything immediately, then eventually you will understand it and then you can begin to make informed decisions, or at the very least ask the write questions and understand the answers, which is a very important first step.

I started out by learning about my 401k, trying to make sense of my different investment options within my plan and deciphering my statements. Then I started looking at Boulevard R, using the planning process tool that is offered here, and that woke me up to the fact that I needed to get more serious about saving if I didn’t want to depend solely on Medicaid when I was older. This led me to committing to reducing my debt, something to which I have paid lip service with varying degrees of success over the years. I am now working to pay it down completely so that I can really focus on building up my savings. So for the time being I’m focusing on learning about debt-reduction, living more frugally, and investing in my 401k. I’m leaving aside learning about other types of investing since I don’t need that information yet. Once my debt is paid down and I start the serious saving, then I’ll learn more about investing beyond my 401k plan.

I’d be interested in hearing what our financial planners have to say about my plan. Based on my personal finance book and blog reading, I’ve determined that it makes the most sense for me to focus on debt-reduction as I said above and for now put only 5% of my income into my 401k, which is what my employer will match. Once my debt is paid off (I’m aiming for 3 years) I will then up my 401k contributions to the appropriate amount. I’ll figure out what those numbers should be when I’m closer to paying down my debt - one thing at a time.

Another thing that I’ve come to terms with in my studying of personal finance is that I’ll probably make mistakes, and that’s okay, it certainly isn’t a reason to not try though. The important thing is to start learning about it and applying that knowledge in an informed way so that I am moving forward in saving for my retirement.

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