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Saving for Retirement is Like Biking Across the Country

Written by: Corey Janoff

Have you ever wanted to bike across the country?  Maybe not, but it would be pretty cool to do if you are a cyclist and have unlimited free time.  Think of saving for retirement like a cross-country bike ride.  There are many ways to go about it.  You will undoubtedly run into some obstacles.  There will be some uphill climbs and some downhill cruises.

If you talk to ten different financial advisors about saving for retirement, you will likely get ten different strategies.  If you follow one of those strategies, you will likely arrive at your final destination in a timely manner.  The key isn’t picking the perfect strategy.  The key is persistence and resilience. 

Different Routes Leading to the Same Destination

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Do you ever check Google Maps before you leave work to see which way home will be the fastest?  I do it all the time.  Is there a traffic jam on the freeway?  Should I take backroads?  Which way is going to get me there fastest?

If you are biking across the country, you may not want the fastest route.  You may want to visit some national parks along the way.  There may be some friends or relatives that you would like to see, so you plan your trip accordingly.  Maybe you’re like me and want to stop at as many restaurants as you can that have appeared on Diners, Drive-ins, and Dives.  You’re going to be burning a lot of calories on that bike – need fuel up. 

Granted, a lot of this depends on how much time you have and where you are starting from.  But odds are, if you are going to take the time to bike across the country, you will want to allow enough time for some pit stops and sightseeing. 

Retirement savings is no different.  Sure, you might want a plan that gets you to retirement as fast as possible.  But if I tell you that means you will live in a studio condo, eat top ramen for most meals, bike everywhere, work overtime, and never take a vacation, you may reconsider. 

OK, OK, you want to get to retirement quickly, but take some time along the way to enjoy yourself.  Take a vacation or two every year.  Go out to a nice dinner every once in a while.  Raise a family – kids aren’t cheap.  We’re on the same page. 

Different Strategies for Getting to Retirement

If you have set a timeframe in which you want to make it from one coast to the other on your bike, you have a lot of options.  Maybe you set a steady pace and follow it consistently for the entire trip.  You could go fast early and coast on the home stretch.  You could take your time early and then bust your butt for the last half of the journey to make it to your destination in time.  Up to you. 

Retirement savings is no different.  If you start out slow, you will have to really pick up the pace on the back nine.

The consistent strategy might be the most attractive plan on paper, but there will be times when it gets tested.  Job change.  Move.  Decrease in income.  Medical expenses.  The list goes on. 

If you start off fast, your future self will thank you.  However, you may miss out on some fun early on in life. 

You are going to have to make some sacrifices and pay your dues at some point.  That could all be up front.  You could spread the pain out over time.  Or you could pile it on at the end and limp across the finish line.

There will Be Obstacles

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If you are going to bike across the country, you will have to climb over a mountain range at some point.  Multiple ones, most likely.  Some will be bigger and more challenging than others.  You can’t get to or from the west coast without going over mountains.  And, although they’re more of a hill than a mountain when compared to the Rockies, the Appalachians guard the majority of the east coast. 

If you turned around to search for an easier path every time you came to a mountain, you will have a tough time making it to where you want to go.  Your best bet is to tough it out and go over the mountain.  Sure, the uphill climb will slow you down a bit.  But odds are, there will be a downhill ride once you get to the peak. 

Investing for retirement is no different.  There will be periods of time where your investments decline in value and it feels like an uphill battle to make any progress.  If history is any indicator though, after a rough patch where your stomach is tested, there will likely be a fast rise in value.  Investing will feel easy during those periods.

Other Challenges

There may be some snow and rain along the way.  At higher altitudes, your lungs will be straining to get oxygen.  Some stretches will be brutally hot and humid. 

You might get a flat tire.  You’ll definitely have to replace your tires a few times along the way with how many miles you will be logging.  Your chain will fall off at some point when switching gears.  Gears will need to be cleaned and greased occasionally.  Your tight biker shorts might rip.  Things like this are bound to happen. 

If you expect to be faced with some challenges along the way, it will be much easier to handle them when they arrive.  On the other hand, if you expect everything to go perfectly, you’re going to be in for a rude awakening.

With your retirement strategy, things won’t go as scripted.  You will face obstacles and challenges.  Expect the unexpected.  You don’t have to plan on every horrible thing happening, but know there will be some hurdles at multiple points.  That’s part of life. 

Are You Up for It?

You may not have any desire to bike across the country, but I’m guessing you would like to retire at some point.  Getting to retirement isn’t going to be a cakewalk.  It will absolutely be like a cross-country bike ride. 

Every day you will need to get up and make some progress, otherwise it will take you forever.  Be persistent and keep moving.  Sure, you can take a few days off here and there, but don’t lollygag too much.  At times, you will be physically and emotionally tested.  Be resilient, get up, and keep going.  The end goal will be so fulfilling when you actually arrive.  

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Disclosures:

Investing involves risk of loss, including total loss of principal.  Consult with a financial advisor when creating  a retirement savings strategy to suit your goals.