NASHVILLE, Tenn. (WTVF) — Whether it's big purchases or little expenses, there's a good chance you're watching your money very closely these days.
However, if you do have a little extra at the end of the month, can putting away a few dollars for your retirement actually end up making a difference in your golden years?
I caught up with a wealth advisor to find out how some current money could stack up down the line.
For me, that little expense I can’t seem to avoid buying is iced coffee.
"I'm not going to sit here and say, ‘oh you're buying a $5 cup of coffee every day, so it's going to ruin your financial plan,’ but I think it does add up over time," said Myles Zueger, a wealth advisor at Adams Wealth Partners in 12 South.
We calculated that if I took all my iced coffee money and put it into a retirement account, it could be worth nearly $100,000 in 25 years.
While there’s no doubt that investing today could pay out big time in decades to come, I was curious if that meant a life with no iced coffees or other tasty treats.
Zueger showed me it’s possible to turn $12,000 a year in investments into close to 7 figures decades down the line.
He also said even $50 a month can really add up in your investment accounts.
However, Zueger doesn't necessarily recommend skipping out on all the things that bring you joy to put away for later.
Rather than cutting out your favorite items, Zueger suggests first looking at items in your current spending that you may barely be using, like subscriptions and other recurring payments.
Beyond that, he said that one of the best ways to build your retirement portfolio is to use automation to take money out right after you get paid.
“What people find over time is that 50 bucks or 100 bucks, they typically don't miss that anyways, because you're doing it automatically, but if they leave it up to themselves to say, ‘hey, at the end of the month, I'll send this money over to my advisor, or my investment account,’ it usually doesn't happen,” Zueger said.
Part of the idea is, by taking care of your retirement automatically, you can look at what’s left over and plan for some of those special things to create memories with friends and family, or those little treats like my iced coffee.
“You can afford that expense as some discretionary expenses in your plan, because you've done the hard part and you've set aside money at the beginning of the month for your investments in your long-term retirement plan,” Zueger said.
If your employer offers a 401K match, Zueger said he always recommends opting in up to the match rate.
Through Adams Wealth Partners, Zueger hosts a podcast dedicated to one of the core principles at Adams Wealth Partners, their Retire While You Work program.
This story was reported on-air by reporter Robb Coles and has been converted to this platform with the assistance of AI. Coles verifies all reporting on all platforms for fairness and accuracy.
Do you have more information about this story? You can email me at robb.coles@newschannel5.com.
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