Let's say you invest $15 as a living-paycheck-to-paycheck 25 year-old. Do you know how much your $15 would be worth if it grew at a modest 8% by the time you retire at 65? It would be worth $364.10 even if you don't invest another penny the rest of your life.

It has been said that even the longest journey begins with a single step. But sometimes that first step is the most difficult to take (especially if it is that step out of bed on any given non-holiday Monday morning).

The same can be said about saving for retirement.

For some, the end of that journey may seem so far off, and the needs right now seem so urgent that saving whatever little money they have left at the end of the month feels futile. But the truth of the matter is that one can never start too early and with too little for it to be of worth. So the first obstacle to overcome is not simply finding the money but rather finding the motivation to set aside even that little bit of money. Once that hurdle is cleared the rest is a matter of discipline and patience.

The first and best option would be to contribute to your company's 401k plan, if they offer one. Most of the time the company will give you some sort of matching funds as incentive to contribute. Also, since pre-tax money is used for contributions, it means more money is put into the plan than you would see coming out of your paycheck.

If you do not have a 401k plan or if even 1% (or whatever minimum is required) of your paycheck is too much right now for you to part with, start by opening an online savings account that requires no minimum balance and has no transfer fees. This way your money will be earning a fair amount of interest while you are accumulating enough to purchase a mutual fund or enough stocks to make it worth your while in an IRA. Keeping cash in an IRA account will usually earn little to no interest.

Once enough cash is saved to purchase a mutual fund, stocks, or ETFs where any load or fees is not a significant portion of the cost (anything above $500), transfer the money to the IRA and start to purchase investments. It is generally not a good idea to make too many transactions with a small amount of money as any potential gains will be offset by fees.

Repeat this process of saving in the online savings account and then funding the IRA when you have enough to make a purchase as the cash trickles in. You will be surprised at how it eventually starts adding up and how it motivates you to save more.

Learn more about this author, Nathan Kim.
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