A GOBankingRates survey reveals that 34% of American adults have nothing saved for retirement.

Zero. Nada. Zilch.

Some of these people save nothing because they earn too little to save. They deserve our compassion.

But tens of millions of Americans aren’t saving anything for another reason entirely.

A couple of years ago, I was invited to do a segment about saving and investing on Fox TV in Tampa.

Near the end, the interviewer suddenly popped this question: “What do you say to those viewers out there who say they just can’t save anything?”

I told the moderator that, in my opinion, too many people save nothing because they’re spending money they don’t have on things they don’t need to impress people they don’t like.

I realize that when you’re young and starting out in life, saving may not be a priority. Or even possible. When you get older, you may have kids or elderly parents to support. Saving can be tough then, too.

But most of us could get by – by hook or by crook – on at least 10% less than what we’re living on today. If we pay ourselves that 10% first, it will make a world of difference 10, 20 or 30 years down the road.

Of course, it’s not hard times or poverty that keeps most Americans from saving what they should. It’s lack of discipline, something that used to be a specialty of mine.

Thirty years ago, I started as a stockbroker at a local firm. It turned out I was good at it – and soon became the firm’s top producer.

Before I knew it I had a spanking-new lakefront house, a ski boat, a Jaguar XJ6 and all the other toys.

When my friends came over for parties – which were frequent – most of them assumed I was rich. I was nothing of the sort.

Wealth is not the same thing as income. If you earn a lot of money and blow it every year, you’re not rich. You’re just living high.

Wealth is what you accumulate, not what you earn. And it certainly can’t be measured by what you spend.

Save $500 a month, compound it at a reasonable 10% a year and you’ll have over a million dollars in less than 30 years. Can’t save that much? Just $250 a month turns into a half-million over the same period.

That beats the heck out of depending on Uncle Sam or your relatives.

It’s really about balance. You can’t be happy – now or in retirement – living like a miser. The trick is to find a balance between saving and spending. Each day there are choices you can make that will help you – or hinder you – on your way to financial independence.

If you’re looking for a bit of inspiration, consider Billy and Akaisha Kaderli. The Kaderlis live in an active adult community in Mesa, Arizona, even though they didn’t meet the community’s minimum age requirements when they joined. The couple ditched the rat race when they were 38 years old.

When they first retired, the Kaderlis sold their home and simply explored the world, traveling between the Caribbean island of Nevis, Venezuela, Mexico and Thailand.

Most folks would say they were living the dream… playing golf, traveling the world and socializing with friends whenever they wanted. How did they do it? Not by striking it rich, but by being frugal.

The Kaderlis decided financial freedom was a lot more important than accumulating more stuff. According to Akaisha, “Every time I looked at a latte or a new pair of shoes, I decided I didn’t need them. If you’re clear about what you want, it becomes easier. You can either buy this or be days closer to your goal.”

Contrast this point of view with the materialistic mindset of many Americans, who often find themselves stuck on what psychologists call “the hedonic treadmill.” Instead of thinking about financial freedom, they’re obsessed with thoughts of a bigger house, a fancier car, the best new restaurants and, of course, a high-definition, 60-inch, flat-panel TV.

If you want to enjoy a comfortable or early retirement, the key is to earn as much as you can, spend prudently and religiously save the difference.

Unlike the performance of the stock market, saving is something that is under your control. Moreover, it’s guaranteed to make a significant impact on your net worth. And – trust me – it’s a whole lot safer than attempting something heroic with your investments.

In short, a successful investment program begins with disciplined saving. It remains one of the safest, easiest and most effective ways to boost the value of your portfolio.

Good investing,

Alex

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Source: Investment U