Here’s when we really want to be celebrating National Save For Retirement Week

I logged in to my Vanguard account earlier this week, and found this admonition:

I must confess, I didn’t know about this celebration week. For this I can only apologize, although to be fair there are plenty of celebration days, weeks, and months to have to remember. For example, the same week was also National Pastoral Care week, National Business Women’s Week, National Friends of Libraries Week, and National Forest Products Week, and I missed all of those.

On the other hand, October is also Pizza Month, and there is no excuse for not knowing about that.

Nevertheless, reading about National Save for Retirement Week got me thinking about it, and more specifically whether our timing of celebration for this holiday might be misplaced.

Legislation to celebrate

National Save for Retirement Week was started in 2006 as a way to raise public awareness about the importance of saving for retirement.  (I note that there appears to be some confusion on whether the name of the thing is “National Save for Retirement Week” or National Retirement Security Week”, but I digress.)

Here is an excerpt from the actual Senate bill (S Res. 550), complete with official sounding “whereas” clauses:

Whereas the cost of retirement continues to rise, in part, because people in the United States are living longer than ever before, the number of employers providing retiree health coverage continues to decline, and retiree health care costs continue to increase at a rapid pace;

Whereas Social Security remains the bedrock of retirement income for the great majority of the people of the United States, but was never intended by Congress to be the sole source of retirement income for families;

Whereas recent data from the Employee Benefit Research Institute indicates that, in the United States, less than 2/3 of workers or their spouses are currently saving for retirement and that the actual amount of retirement savings of workers lags far behind the amount that is realistically needed to adequately fund retirement;

The text, being a simple enough bill that I can understand it (unlike say, other important pieces of legislation) seems pretty sensible. In short, because pretty much everyone is going to have to deal with retirement eventually, we need to be more of a retirement expert. Not only that, Social Security is not something we can rely on, at least not primarily. And also, most people are not saving as much for retirement as they ought to (if they are saving at all).

Sounds like what I’ve been talking about for years on this site.

Let’s be aware, but let’s take action

So the purpose of the week is to raise awareness about a cause, not unlike, say, how we raise awareness for breast cancer or autism.

And so I highly encourage you, if you haven’t already, to take some steps toward preparing for your retirement. For example, I recently showed you how to set up a Roth IRA with Vanguard. With only $1,000 and less than an hour of your time, you could set up an account that could see you through the rest of your life, if managed properly.

But this also brings up a very important point, and one that National Save For Retirement Week might run the risk of obscuring.

It’s important to start saving for retirement now, of course. But what’s more important is not what you do now, but what you do next week and next month. And the month after. And the month after that.

If saving for retirement was a one-time action, it would be one thing.

But the way that people succeed at retirement, the way people have $1,000,000 of their own money (which isn’t all that much these days, but still), is by dedicated repeated action.

I put money away for retirement every single month. Whether it’s through my IRA or my 401(k), I aim to set aside at least 15% of my gross income to retirement saving.

You need to do this too. If not 15%, then commit to some goal. Maybe you can only save 5% now. That’s fine. As you make more money over time, you can raise that percentage.

One thing you can do today is automate this investment. You can set up an automatic transfer, which is what I do.

Ultimately, the celebration is an important one, but I’m going to celebrate National Save For Retirement Week next week too. And the week after. And the week after that. It’s too important to leave to just one week.

But enough about me. What one thing can you do right now to help in your retirement journey?